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The Role of International Insurance Companies The Role of International Insurance Companies in the opening of frontiers: development of in the opening of frontiers: development of
new productsnew products(Takaful)(Takaful)
Sohail JafferSohail JafferPartner, FWU GroupPartner, FWU Group
FWU group won the Euromoney Islamic Finance Awardfor being the "Best Islamic white label service provider“.
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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FWU’s definition of BancassuranceFWU’s definition of Bancassurance
«Bancassurance is defined as the delivery and distribution of a suitable range of tailored ‘bankable’ protection and long term savings and pension products designed to meet the lifecycle needs of the customer base of a bank or other financial institution.»
CustomerDemand Driven
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Bancassurance - Asset Management - FactoringBancassurance - Asset Management - Factoring
FWU-GROUP‘s Core Business CompetenciesFWU-GROUP‘s Core Business Competencies
The group is well The group is well positioned to meet the life positioned to meet the life assurance, investment assurance, investment and pension needs of and pension needs of institutional and private institutional and private clients in Europe, Middle clients in Europe, Middle East and Asia with state of East and Asia with state of the art bancassurance & the art bancassurance & Shari‘a compliant Life Shari‘a compliant Life products.products.
GermanyGermanyLuxembourgLuxembourg
AustriaAustriaItalyItaly
FranceFrance Saudi Arabia Saudi Arabia
United Arab Emirates United Arab Emirates Pakistan Pakistan
MalaysiaMalaysia
KuwaitKuwait
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FWU Group’s International Business ModelFWU Group’s International Business Model
Clone international Bancassurance success
customer convenience tailored ‘white label’ solutions quality training and sales support
FWU Shari’ah Board &
Expertise
commission factoring solution exclusive Retakaful solution selection of service providers incl.
custodian bank
Web-based POS & Admin System
Strategic Product
Partners
Structured asset management approach
Product & process innovation
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Benefits of ‘White label’ Bancassurance SolutionBenefits of ‘White label’ Bancassurance Solution
Bank defines own commission level
Tailored customer solutions
Bank offers choice of both conventional
Bancassurance and Takaful products
Bank has choice to participate in other modules of the service value chain (custodian, brokerage, transaction banking)
Structured asset mgt. approach linked to open inv. architecture
Seamless integration into Bank’s own brand
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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FWU Group‘s international Bank distribution and FWU Group‘s international Bank distribution and Strategic product partnersStrategic product partners
Product administration, and claims management
Customer statements Financial accounting Filing with local regulatory
authorities
New product development, Product launch support Product management,
Marketing & Training support
Structured asset mgt. apporach
Systems support to Strategic Product Partner and Bank Distribution Partner
Product enhancements & Shari’ah compliance
FWU Int. NetworkDubai, KL
& Luxembourg
Aman Insurance UAE
Al Ahli Takaful Company
KSA
EFU Life Insurance Pakistan
Takaful IkhlasMalaysia Bank is Custodian of all customer
funds in the Savings Plan
Bank Customers
Al Safat Takaful Company
Kuwait
Bank Distribution Partners FWU's existing distribution partners
include: NCB in KSA and ADCB in UAE
Local Life Insurance Product Partner
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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Main product features and customer benefitsMain product features and customer benefitsFWU Group‘s "White Label" Savings, Education and Retirement Plans – FWU Group‘s "White Label" Savings, Education and Retirement Plans – Product HighlightsProduct Highlights
Plan benefits are available to all bank customers
No medical examination of bank customer required (up to a defined limit)
Transparent and cost efficient structure
Accelerated sales process using FWU’s Point of Sale and Administration technology
Plan benefits are available immediately to all bank customers
All bank customers are insurable
Eliminates important psychological barrier
Greater customer comfort
Immediate risk cover for bank customer
Product features Customer Benefits
Bank customer convenience
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-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
USD
('00
0)
Year 1 Year 2 Year 3 Year 4 Year 5
Bank Income Growth – 5 year period
Conservative AverageBest
Bank Annuity Income: Attractive Dynamics
Conservative Average Best
Base Assumptions:Number of Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000 40,000 50,000Average duration 15 yearsAverage monthly contribution $ 200Lapsation rate 2 to 10 % p.aFund growth rate 7 % p.a
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Cumulative Bank Income over a 5 year period
0
5
10
15
20
US
$ in
Mill
ions
Conservative Average Best
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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FWU’s fund selection and
allocation model
Structured Asset Management Approach
Overweights the winners & underweights the losers
Objective Investment
process
Agreed funds target universe
Enhance return by 15% to 25% p.a
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Fund Selection Process Based on Funds’ returns, risk and
correlation amongst each other, funds are ranked from best to worst => Each fund is given a score, based on its ranking.
Using the above rankings => Top eight funds are selected.
FWU‘s Dynamic Fund Selection and Allocation Model
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FWU‘s Dynamic Fund Selection and Allocation Model
Allocation model (key value added)
Overweighting of the outperformer
Underweighting of the underperformer
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Investment Proposal for Regular and Single Premium Savings Plans
FWU‘s Dynamic Fund Select & Allocation Model
Investment in External Islamic Mutual Funds
Strategy 1Strategy 1Conservative
Portfolio
Strategy 2Strategy 2BalancedPortfolio
Strategy 3Strategy 3Growth
Portfolio
Launched as internal funds ofFWU‘s local Takaful Product Partner
Strategy 4Strategy 4DynamicPortfolio
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Investment Advantages of Pooling
0-10080:2050:5025:75
Conservativeportfolio
Balancedportfolio
Growthportfolio
Dynamicportfolio
Equity PoolCash
EquivalentPool
Direct Investment in: Sukuk Murabaha Trade-Finance
CustodianBank
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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The value added – why FWU GroupThe value added – why FWU Group
Customised product design
Product training and sales support
Business simulation model
Regional service hubs
Sophisticated Point of Sale and Administration System
Dynamic funds select and allocation model
Cost efficient Agency structure
Unique Retakaful arrangement
ENTREPRENEURIAL ENTREPRENEURIAL
PARTNERPARTNERINNOVATIONINNOVATION
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Product Highlights and customer benefits Dynamic Fund Selection and Allocation Model FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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FWU-Group‘s Exclusive Retakaful Pooling ArrangementFWU-Group‘s Exclusive Retakaful Pooling Arrangement
FWUFWU –– GROUPGROUP
Administrator-Data processing and administration Asset Management
Hannover Re(„AAA rated“,
3rd largest life Reinsurance)
Wakeel/Trustee- Fee Basis- 100% profit redistribution- Quard Hasna- Shari‘ah compliant Investments
Pooling Pooling ArrangementArrangement
The National Commercial Bank
Jeddah
Abu Dhabi Commercial
BankMajor BankDistribution-
Partners Major Bank
KSA UAE Pakistan Malaysia
Bank distribution partners in the following markets
InsurancePartners
Al Ahli TakafulCompany
NCB/FWU / IFC
Dubai Islamic Insurance & Reinsurance
AMAN
Eastern Federal
Union LifeEFU
Takaful Ikhlas
SDN BHD
Establishment of insurance provider through joint venture or strategic cooperation agreement
Major Bank
Kuwait
Al Safat TakafulCompany
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ContentsContents
FWU’s International Business Model International Bank Distribution and Strategic Product
Partners Retakaful Pooling Arrangement Structured Asset Management Approach FWU’s Value Added FWU’s Retakaful Pooling Arrangement FWU Group
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Dr. Manfred J. Dirrheimer andDr. Manfred J. Dirrheimer andPartnersPartners
VHVVersicherungen,
Hanover
95%
FWU AGFWU AGMunich, Luxembourg, Dubai, Kuala LumpurMunich, Luxembourg, Dubai, Kuala Lumpur
80%74,9% 100% 10%
25,1% 25,1%
5%
100%
PREMIUM SELECT LUX S.A.
Luxembourg
ATLANTICLUX Life Insurances S.A.
Luxembourg
FWU Payment Services GmbH
Munich
FWU Commission Factoring GmbH
Munich
Al Ahli Takaful Company Jeddah, KSA
Swiss Re FrankonaRückvers. AG,
Munich
13,25% 30%
An entrepreneurial and institutional partnership
90%
National Commercial Bank,
Jeddah, KSA
VHVVersicherungen,
Hanover
IFC International Finance CooperationWashington
Wave Asset Management AG
Hamburg
13,25%
FWU-GRUPPE
Branch
Bolzano
Branch Luxemburg
International HQ
Branch Dubai
Regional HQ ME
Branch Kuala Lumpur
Regional HQ FE
7,5%
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FWU Group – Profile FWU Group – Profile
The FWU Group is an entrepreneurial financial services group with headquarters in Munich, Germany.
Further offices are located in Luxembourg and Dubai Internet City (DIC). Group shareholders include GE Frankona Re AG, an international re-
insurer, and European banks and insurance companies. Core activities are Bancassurance, Savings & Pension Plans and Asset
Management. Group subsidiaries include:
– an Asset Management Company (PREMIUM SELECT LUX S.A.)– a Life Insurance Company (ATLANTICLUX S.A.)
Both are based and regulated in Luxembourg.
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ContactContact
The information in this presentation does not constitute a sales offer, investment advice or an offer for the acquisition of financial products or instruments, and shall not in this regard imply legal obligations for the FWU Group or anybody else towards the readers of this presentation.
This presentation is solely intended to provide information on matters of interest for the readers and such information is not meant to replace the knowledge and the judgment of the readers who should make all appropriate inquiries.
Mr. Sohail JafferMr. Sohail JafferPartner, FWU Group2, Rue Sainte ZitheL-2763 Luxembourg
Email: [email protected]: +352 – 2 61 97 700Fax: +352 – 2 61 97 800
Internet: www.fwugroup.com