“Azerbaijan’s insurance market is small but growing. Total insurance premiums reached AZN 1.353 billion (approximately USD 796 million) in 2024, a 10.7% year-on-year increase. Insurance penetration stands at 1.1% of GDP, up from 0.99% in 2023 but well below the OECD average of 6.2%. The market comprises approximately 16 insurance companies regulated by the CBAR. Azerbaijan’s low insurance penetration represents both a structural challenge and an opportunity. The introduction of takaful products could serve as a catalyst for deeper insurance adoption, particularly among segments of the population that may be reluctant to engage with conventional insurance due to concerns about its compatibility with Islamic principles”, says the report of the Islamic Development Bank Institute (IsDBI) and the International Islamic Trade Finance Corporation (ITFC) titled “Islamic Finance in Azerbaijan: Breaking New Ground” launched during the IsDB Group Annual Meetings in Baku.
The global takaful market has grown significantly, reaching an estimated USD 33-40 billion in GWP in 2024, with asset growth of 16.9% and an increase of 15.4% in GWP. Despite this growth, takaful accounts for approximately 1.4% of total global Islamic finance assets, with much room for expansion.
The GCC region dominates, making up close to 85% of global takaful contributions, with Saudi Arabia, Malaysia, UAE, Indonesia, and Iran as the largest markets, the source added.
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