In an interview with Oman Daily, sister publication of the Observer, Al Salmi said that in the last year the insurance sector has seen new developments after the government approved the Takaful insurance -- one of the Islamic products in the banking sector -- by issuing licences for two companies: Madina Takaful and Oman Takaful. In the same year, the Takaful trade accounted for 6 per cent of RO 397 million which is the total insurance premiums.

The Takaful insurance has seen a good response, Al Salmi said adding that the CMA is currently studying the applications for more Takaful insurance companies. The CMA is currently laying down new regulations for investing the funds of Takaful insurance and traditional insurance companies and these regulations are expected to be issued by the end of this year. In spite of the encouraging beginning of Takaful insurance companies, there are some challenges of the sort that is normally associated with the beginnings for instance some legislative aspects need to be complemented besides other problems such as the lack of experiences, and the absence of accounting criteria.

The Takaful insurance law is now in its final stage and expected to be approved shortly.