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CEO Message

The year 2015 was yet another challenging year for Takaful International. The Company’s overall written Contributions was BHD19.6M which declined by around 6% compared to previous year. This was mainly due to the Takaful’s cautious underwriting policy where company increased its contributions or declined writing some of the loss making business thereby adopting better underwriting policies to protect the interest of its stakeholders. The shortfall in contributions was mainly in the Medical and Engineering lines of business.

The overall net incurred claims improved from 90% during year 2014 to 77% for the ended 2015.

The improvement was mainly in the Medical and Motor lines of business. The Company had also taken prudent steps by improving its policies and procedures and has implemented stricter policies for impairment of receivables and investments.

This resulted in overall loss of BHD755K in the shareholders and BHD943K in the policyholders entities.

The steep fall in the oil prices and the ongoing political instability in the region has affected the entire region and its business.

Takaful has made changes to its Medical Reinsurance arrangements during the year. The company has also taken prudent steps towards underwriting Medical business by increasing contributions on accounts with high claims and even declining the business with very high claims ratio. These steps will help in improving the overall underwriting results of its Medical business.

Our Qatar operations had shown moderate growth in the business written. We have a positive outlook on Qatar business and expect good growth during the year ahead.

I would like to highlight some of the important results of the company which are reflected in the following graphs and are self-explanatory:


Financial performance:


The total contributions for the year ended 31 December 2015 amounted to BHD19.6M, a reduction of 6% from the total contributions underwritten during year 2014. The Net Earned Contribution amounted to BHD12.5M for the year ended 31 December 2015, a 17% increase as compared to the Net Earned Contribution for 2014. The Company registered underwriting revenue of BHD14.1M in 2015 as against BHD11.7M during 2014.

Overall management, general and administrative expenses for year 2015 which amounted to BHD3.3M was lower than previous year BHD3.4M.

During the year 2015 the net accrued acquisition cost expenses were recorded in shareholders entity which was being recorded in the policyholders account until year


The Company implemented stricter impairment policies on receivables and investments which had impact of around BHD1.4M provisions on impairment of investments and

BHD1.392M comprising of write-offs of impaired receivables as well as provisioning done for impaired receivables.

This resulted in the overall net loss of BHD755K in shareholders account, BHD1M net loss in General Takaful account and BHD142K profit in Family Takaful account.

Although 2015 was a challenging year we had some very positive developments in the Company. The introduction of BKIC as the major shareholder of the company has added to Takaful’s strength. BKIC is one of the largest insurance company in Bahrain which is a member of The Gulf Insurance Group, Kuwait. Thus along with its other major shareholders, BISB & Al-Amana Alama shareholders, Takaful, now has a stronger shareholder structure, thereby adding to its strength and opportunity to develop and diversify its business in the region.

Takaful has consistently endeavoured to fulfil the growing expectations of its shareholders, policyholders and other stakeholders. Nurturing long-term relationships and best services have always been the highest priority of Takaful. Since inception, Takaful has believed in building a culture of integrity, transparency and endeavoured to revolve all its business activities based on its founding principles of fairness, kindness, efficiency and effectiveness.

Our Board of Directors believe in upholding the highest standards of governance and accountability. The board has taken cognizance of various regulatory changes in the overall governance framework and remains committed to imbibing the spirit of the law and regulations.

Although standing in the midst of the falling oil prices and other regional issues which is the biggest challenge for all business, we expect a positive outlook for the year 2016 and expect a moderate growth in business. Our main focus will be on quality services, prudent claims management and expenses which will help the company to generate better results.

I would take this opportunity to thank our Board of Directors for their support and guidance. I also thank the employees of the company for their dedicated efforts. I also thank our valued clients, reinsurance companies, Sharia’a board members, intermediaries and all our business partners for their support which has contributed in the growth of the company.

Younis J. Al Sayed
Chief Executive