Demand for Sharia-compliant home insurance 'on the up'

Posted : 25-01-2008

There is an increasing demand among consumers for home insurance products that comply with Sharia law, it has been suggested.

A spokesperson for HSBC said that home insurance that is known as Takaful – meaning solidarity between participants" – is becoming sought-after.

And while the Islamic insurance sector in the UK is currently in its "infancy", the HSBC spokesperson believes everything points to the industry developing in the coming years.

"The demand for insurance that is compliant with Sharia is constantly growing and shows the need for insurance companies to provide suitable solutions," he added.

The spokesperson conceded that insurance is a "far more complex" sector when it comes to comply with Islamic principles.

Through its global Islamic banking division HSBC Amanah, the HSBC Group offers a home insurance product entitled Home Takaful.

According to the spokesperson, this home insurance product does not compromise on beliefs and operates through a system that allows participants to donate part or all of the contributions.

Such a fund is then used to pay out claims for damages suffered by some of the participants, while the role of the home insurance provider is to manage operations and invest funds in line with Sharia principles, the representative explained.


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