Kuwait Finance House (KFH) Kuwait Chief Executive Officer, Khaled Yousef AlShamlan has announced an unprecedented cooperation through KFH Takaful Insurance Company with the United Nation Development Programme (UNDP). The partnership entails finding novel insurance solutions that contribute to facing challenges arising from climate change risks.

The first roundtable discussion for leaders on Takaful's role in mitigating climate risks was held on Tuesday September 5th. During this event, AlShamlan said: “As the largest bank in Kuwait and the second Islamic Bank in the world, KFH enjoys outstanding experience in all fields, particularly those relating to symbiotic insurance which will have a vital role in confronting the challenges of climate change and dealing with risks and disasters. Symbiotic insurance has proven to the world that it is the best way of cooperation because it creates a collective effort with financial resilience.”

He added that KFH prides itself on its rich history which made it the largest bank in Kuwait, the second largest Islamic bank in the world and a leader of global Islamic finance industry.

AlShamlan noted that these experiences resulted in the establishment of the first Takaful insurance company in Kuwait, with the prospect of offering new solutions to mitigate against risks and disasters. Add to this KFH’s several social contributions relating to the environment.

In conclusion to his speech, AlShamlan hoped that the discussion will crown this cooperation with positive results to confront the present and future challenges.

Meanwhile, UNDP Kuwait Resident Representative, Moises Venancio said that the purpose from this event is to delve into the vision behind the Global Takaful Alliance.

“This vision, ambitious yet essential, seeks to provide affordable climate risk protection to 100 million individuals by 2030. Equally vital is our commitment to transcending socio-cultural barriers that have historically hindered access to conventional insurance.” added Venancio.

He went on to say that this vision aligns seamlessly with the principles of Islamic finance, especially the core tenets of Takaful, which center on mutual assistance, risk sharing, and ethical conduct.

Venancio said that the urgency of this initiative cannot be overstated. Vulnerable communities, often burdened by limited insurance coverage, bear the brunt of climate-related disasters, adding that with only 7% insurance penetration on average in many developing nations, the need for accessible risk protection is paramount.

“The collective purpose today is to unite our efforts in bridging this gap. We harness the potential of Islamic finance to craft tailored solutions that respect social and cultural values.” added Venancio.

He pointed out that by building an enabling ecosystem, fostering innovative risk transfer solutions, and driving systemic change through policy advocacy and awareness campaigns, the UNDP aims to empower communities to withstand climate shocks and ensure sustainable development.

He concluded by noting that UNDP is ready to work with everyone, in turning the ideas into long-term financial resilience for those who need it most.

During the first discussion titled Managing Climate Risks and the Takaful Nexus, UNDP Special Advisor and Head of Insurance and Risk Finance Facility, Jan Kellett said together with KFH, forming a global Takaful Alliance is a crucial step forward to achieving sustainable development.

Kellett added that a global collaboration on Takaful can strengthen the financial resilience of vulnerable communities by increasing the insurance coverage and providing financial protection against climate impacts, ensuring development plans are sustained in affected communities.

He revealed that with its presence in over 170 countries, the UNDP aims through this global Takaful Alliance to provide comprehensive and broader solutions in new regions of the world enabling financial resilience against climate risks to 100 million people by 2030.