Car insurance: New Sharia complaint car cover
UK's first Islamic insurance firm OKed by FSA
Thursday, 01 May 2008 12:13
The UK's first Islamic insurance company has been given authorisation by the regulator the Financial Services Authority (FSA).
Principle Insurance will provide Shariah-compliant motor and home insurance to British residents from later this year.
"We estimate that in excess of 500,000 British Muslims are car owners and, with motor insurance being a legal requirement, these consumers currently have to buy motor insurance that compromises their beliefs," said Principle chief executive Bradley Brandon Cross.
"Some elements of conventional UK insurance, such as the earning of interest, the investment of policyholders' funds and uncertainty mean that it is not in accordance with Muslim beliefs.
"We are going to be offering unique insurance products that meet a genuine need and are also competitively priced."
Islamic insurance follows the success of the Shariah-compliant finance sector over the last decade – with Islamic mortgages and investment products becoming more widespread.
The Treasury is also set to start issuing Sharia-compliant government bonds – in a bid to make London a world centre for Muslim finance.
Abdulaziz Hamad Aljomaih, Principle chairman, said: "I believe Principle will go some way in altering the perception of Islamic Finance in the UK, by showing that progressive, sensible and profitable businesses can be established in accordance with Islamic law.
"Achieving FSA authorisation is a clear vindication of my belief that Shariah-compliant financial products are not only equitable and profitable but also conform to the modern-day principles of international finance, especially from a regulatory standpoint."
Daniel Barnes