Mitsui Sumitomo to buy a stake in Islamic insurer?
Japan’s Mitsui Sumitomo Insurance is reportedly interested in tapping into the Islamic insurance market, saying it might buy a share of Malaysian Hong Leong Takaful from its rival Tokio Marine. Mitsui already has an alliance with the Hong Leong Financial Group worth US$480 million and sees an opportunity as demand for Islamic insurance rises, while Tokio Marine is keen to sell its 35% share to focus on a broader insurance strategy, rather than savings-type policies.
Mitsui Sumitomo itself is a unit of MS&AD, Japan’s largest property-casualty insurance company. MS&AD is already in talks to invest in several other Asian insurance firms, while Mitsui is seeking out new opportunities in emerging markets. Japanese financial institutions are looking increasingly overseas as their domestic market shrinks, particularly for large scale infrastructure projects and non-life insurance.
Takaful (Islamic insurance) contributions make up only 1% of the global total, but some such as Ernst & Young have predicted it could be worth $7.7 a year by 2012. The growing wealth of large Muslim populations in Malaysia and Indonesia presents an attractive opportunity for expansion.
source & article: Reuters via Yahoo! Singapore
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