SALAMA GROUP Sh. Khaled Bin Zayed Al Nehayan Chairman 1.

SALAMA GROUP Sh. Khaled Bin Zayed Al

NehayanChairman

1

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CONTENTS

• SALAMA Group Overview

• Takaful market and potential

• Financial Highlights

• Takaful

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• Takaful

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WHAT IS TAKAFUL?Takaful, an Arabic word meaning “joint guarantee”, is• a form of mutual insurance that strictly observes the rules and

regulations of Shari’a (Islamic law) • the Takaful system is based on mutual co-operation, responsibility,

assurance, protection and assistance between groups of participants• to uphold the principle of "bear ye one anothers burden"• described as a form of mutual insurance• in practice in Arabia from the 6th century

There are three (3) models based on which Takaful is implemented:

• Mudaraba Model (Profit Sharing)• Wakalah Model (Nominating another person)• Combination of both

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WHY NOT COMMERCIAL INSURANCE?

• As agreed upon by most contemporary Muslim

scholars, commercial insurance is strictly

forbidden in Islam because it contains elements

of:

– Al-Gharar (Uncertainty)

– Al-Maisir (Gambling)

– Riba (Interest)

Operational Issues of Takaful - Capital & Reserves

6Source: Tokio Marine – WTC 2008

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WHAT IS RE-TAKAFUL?

• Re-Takaful (reinsurance) provides the same services

as Re-insurance industry

• shares risk with Takaful operators, in accordance with

requirements and practices of Shari’a

Takaful Holders Takaful Operator Retakaful Operator

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• Takaful

SALAMA Journey

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Foundation &

Beginning

• Formed in 1979 - first Takaful Company in the world.• Founding Shareholders donated initial capital of AED 10m. • As per prevalent Takaful Model at that time, shareholders did not participate in the profit of the company.

• Company started operation in UAE and established branches in Saudi Arabia.

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SALAMA GROUP - OVERVIEW

• Formed in Jan 2005 after acquisition of TARIIC in Bahrain by UAE based Islamic Arab Insurance Company (SALAMA)

• SALAMA is the largest Takaful and Re-Takaful Company in the world with a total Market Cap of US$ 850 million

• SALAMA has direct Takaful companies in UAE, Saudi Arabia, Egypt, Algeria, Senegal and Jordan and the largest Re-Takaful company in the world operating out of Tunisia

SALAMA - COMPETITIVE ADVANTAGES

• External– A Leading Takaful and

Re-Takaful operator – Extensive geographical

coverage and product diversity

– Early entrant advantage

– Command “brand loyalty” among clients

• Internal– Robust growth since

inception– Strong underwriting

principles & conservative investment strategy

– Highly professional and experienced management team

– 100+ years of combined experience in the industry

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MANAGEMENT STRUCTURE - HOLDING

Board of Directors

Saleh J. MalaikahVice Chairman &

CEO

Khalid MateinChief Investment

Officer

Mohammed AshrafChief Internal

Auditor

Imran HaiderChief Financial

Officer

Ighassan DavidsChief Information

Officer

BEST RETunisia

SALAMAAlgeria

SOSARSenegal

ESIHEgypt

IAICKSA

SALAMAUAE

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OWNERSHIP % OF ENTITIES AT END OF 2007

SALAMA HOLDINGPaid Capital US$ 300m

Market Cap US$ 1 b (approx), Free Float about 35%,

Foreign Ownership restricted to 25%,

Rating : S&P “BBB+”, A M BEST “A-”TARIIC HOLDING

Paid Capital US$ 100mSALAMA owner ship 99.6%

BEST REPaid up Capital

US$ 100mTARIIC 77.75%SALAMA 22.25%

SALAMAAlgeriaPaid up Capital

US$ 6m TARIIC 89.11%

SALAMASenegalPaid up Capital


ESIHEgypt

Paid up Capital


SALAMASaudi Arabia

Paid up Capital

US$ 27m SALAMA

30%

SALAMAUAE - Virtual

Allocated Capital

US$ 5m SALAMA

100%

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GROUP STRATEGY

• Consolidation of Group of Entities

To adopt common and standardized approach across all functions to achieve synergies without stifling innovation and initiatives.

• Organic GrowthTo enhance our products offering to include family, health and other Takaful products.

• Geographical Expansion

Expand our geographical spread through M & A and entering new promising markets.

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GEOGRAPHICAL EXPANSION

Target countries for geographical expansion depending on economic feasibility:

1. Kuwait2. Qatar3. Oman4. Turkey5. Pakistan6. Malaysia7. Indonesia

Countries for future expansion

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• Takaful

MARKET OVERVIEW

Takaful markets are estimated is estimated US$ 5.6 billion in 2006¹

Annual premium growth rates forecast to be 20% p.a. World insurance premium volume for both Life & Non-Life totaled

$3723 billion. 1 The growth in world insurance premium real term was only 5% . 1 The life insurance premium grew by 7.7% and non-life insurance

premium grew by 1.5% . 1 60% of Muslim population across the globe is under 25 years of

age Retail markets contribute very less to the gross premiums as

compared to the businesses

• Takaful Industry is expected to grow to US$15 billion by 2015

17Source: 1 – Sigma 4/2007

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KEY DRIVERS FOR TAKAFUL INDUSTRY

• Young and rapidly growing population

• Rapid economic growth driven by oil, gas, construction, real estate & booming domestic demand

• Increasing privatization & development would increase demand for corporate insurance

• Implementation of compulsory insurance

• Liberalization of Insurance industry in the GCC

• GCC countries setting up local financial centers attracting foreign players

• Growing awareness of Takaful

• Rising income levels

• Higher literacy rate

• Increase in nuclear families

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KEY GROWTH

EuropeMiddle East & North AfricaAsia / Southeast Asia

Key Takaful Growth Regions

Note: Countries with a significant Muslim PopulationSource: MEED, International Cooperative and Mutual Insurance Federation – ICMIF, CIA World Fact book

Global Takaful Statistics

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Region Country Gross Premium in USD m % Total

2004 2005 2006 Est 2004 20052006

Est

Africa Egypt 2.5 3.0 4.0 0.1% 0.1% 0.1%

Mauritania 0.4 0.4 0.4 0.0% 0.0% 0.0%

Senegal 6.0 5.9 7.0 0.2% 0.1% 0.2%

Sudan 112.0 171.6 203.1 3.2% 3.9% 4.6%

Sub-Total 120.8 180.9 214.5 3.4% 4.1% 4.8%

East IndianSub- continent Bangladesh 3.1 3.5 4.2 0.1% 0.1% 0.1%

Pakistan - 0.1 0.2 0.0% 0.0% 0.0%

Sri Lanka 2.4 4.2 6.8 0.1% 0.1% 0.2%

Sub-Total 5.4 7.8 11.2 0.2% 0.2% 0.3%

Source : Takaful Re – WTC 2008


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Region Country GWP in USD m % Total

2004 2005 2006 est 2004 2005 2006 Est

Far East Brunei 22.5 27.0 30.0 0.6% 0.6% 0.7%

Indonesia 73.5 74.2 80.1 2.1% 1.7% 1.8%

Malaysia 338.7 405.4 522.8 9.5% 9.1% 11.8%

Singapore - 0.1 0.1 0.0% 0.0% 0.0%

Thailand 28.7 30.0 32.4 0.8% 0.7% 0.7%

Sub-Total 474.3 552.4 687.8 13.4% 12.4% 15.5%

GCC Bahrain 14.5 15.0 33.7 0.4% 0.3% 0.8%

Kuwait 53.6 82.9 90.0 1.5% 1.9% 2.0%

Qatar 24.7 33.6 50.0 0.7% 0.8% 1.1%

Saudi Arabia 646.8 755.6 831.2 18.2% 17.0% 18.7%

UAE 30.6 41.5 65.0 0.9% 0.9% 1.5%

Sub-Total 770.2 928.6 1,069.9 21.7% 20.9% 24.1%


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Region CountryGWP in USD m % Total

2004 2005 2006 Est 2004 20052006Est

Levant Jordan 12.9 14.5 17.3 0.4% 0.3% 0.4%

Lebanon - 4.0 4.8 0.0% 0.1% 0.1%

Yemen 0.8 1.0 1.5 0.0% 0.0% 0.0%

Sub-Total 13.7 19.5 23.6 0.4% 0.4% 0.5%

Middle East (Non Arab) Iran 2,163.8 2,750.0 3,685.0 61.0% 61.9% 83.0%

Sub-Total 2,163.8 2,750.0 3,685.0 61.0% 61.9% 83.0%

Grand Total 3,548.3 4,439.2 5,692.0 100% 100% 100%


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120.8 180.9 214.5

474552 688

770

929

107014

20

24

2,163.8

2,750.0

3,685.0

5

8

11

0

1,000

2,000

3,000

4,000

5,000

2004 2005 2006 est

USD Millions

Global Takaful / Islamic Gross Contribution Income by region 2004 - 2006

Africa Far East GCC Levant Middle East (Non Arab) East Indian Sub-Continent

`

Insurance Premium Density – premium per capita (US$)

Top FiveTop FiveUnited Kingdom 6,466.7Ireland 5,564.7Switzerland 5,561.9Denmark 4,271.4France 4,075.4

World 554.8

Muslim WorldQatar 683.5UAE 585.4Malaysia 292.2Kuwait 227.2Lebanon 181.5

Source: Sigma 4/2007


Top FiveTop FiveSwitzerland 2,450.1United States 2,134.2Luxembourg 1,817.9Netherlands 1,757.3Canada 1,504.3

World 224.2

Muslim WorldQatar 652.6UAE 495.6Kuwait 186.3Lebanon 123.6Oman 119.4

Non Life



Top FiveTop FiveUnited Kingdom 5,139.6Ireland 4,203.8Switzerland 3,111.8France 2,922.5Finland 2,903.1

World 330.6

Muslim WorldMalaysia 189.2UAE 89.8Lebanon 57.9Kuwait 40.9Qatar 30.9

Life


Insurance Penetration – % of GDP

World 7.5%

Top FiveTop FiveUnited Kingdom 16.50%South Africa

16.00%Taiwan

14.50%South Korea

11.10%Switzerland

11.00%

Muslim WorldMalaysia 4.90%Lebanon 3.00%Morocco 2.90%Jordan 2.40%Tunisia 2.00%



World 3.00%

Top FiveTop FiveSwitzerland

4.90%United States

4.80%Netherlands

4.30%Slovenia 4.00%Canada 3.90%

Muslim WorldJordan 2.20%Morocco 2.10%Lebanon 2.00%Tunisia 1.80%Angola 1.70%Malaysia 1.70%

Non Life



World 4.50%

Top FiveTop FiveUnited Kingdom 13.10%South Africa

13.00%Taiwan

11.60%Hong Kong

9.20%Japan

8.30%

Muslim WorldMalaysia 3.20%Lebanon 0.90%Indonesia 0.80%Morocco 0.80%Bangadesh 0.40%

Life


Takaful Market

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Source: The World Takaful Current Achievement & Future Outlook: BEST RE March 2006

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• Takaful

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FINANCIAL HIGHLIGHTS

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FINANCIAL HIGHLIGHTS

54% 48%

41%46% 46%

54% 57%61% 61%

80%

37%30%

0%

20%

40%

60%

80%

Fire Accident Engineering Marine Motor Other

Loss Ratio by Line of Business2006

2007 MagtAccts

87%88%

85%

90%82% 81% 90% 87%

103%

92% 88% 89%

0%

20%

40%

60%

80%

100%

120%

BEST RE SALAMAAlgeria

SALAMASenegal

ESIH Egypt SALAMA UAE SALAMAGROUP

Combined Ratio by Line of Business2006

2007 MagtAccts

Thank you

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SALAMA GROUP Sh. Khaled Bin Zayed Al Nehayan Chairman 1.

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