National Takaful Company P.S.C.

CORPORATE PROFILE

Introduction

Watania

National Takaful Company (Watania) is a young and dynamic organization that came into being in 2011. Watania was issued a license by the UAE Insurance Authority on the 12th of July, 2011 and was listed on the ADX on the 14th of November, 2011.

Watania has a paid-up capital of AED150 m and its head office is in , .

Watania is an initiative taken by Abu Dhabi National Insurance Company (ADNIC) (16%), Abu Dhabi National Islamic Finance (ADNIF) (16%), Abu Dhabi National Energy Company (TAQA) (7%), and (7%). Their objective was to establish a leading takaful operator in the UAE which could meet the demand of the UAE market for Sharia compliant insurance products.

Watania floated its stocks for an IPO on the 18th of April 2011 with issue oversubscribed nearly 7 times. After the allotment process, Ajman Bank (16%) and Qatar First Development Bank (10%) joined the ranks of the founding shareholders. Watania started underwriting risks on 14th of November, 2011.

In August 2014 there was a major change in the shareholding structure of Watania whereby MB Investment UAE and Madina Takaful Oman acquired a majority 60% stake in the company from existing shareholders.

Current major shareholders are MB Investment UAE (51%), ADNIF (15.74%), Madina Takaful, Oman (9.54%) and Bin Harmal (8.37%).

Vision

Vision behind Watania formation is To become the leading General Takaful operator of choice by delivering world-class takaful solutions for the protection of all stakeholders

Mission

The mission of Watania is to

Promote General Takaful awareness in the community and ensure policyholders’ satisfaction by offering quality products and services. Deliver optimum returns to the shareholders by adhering to best practices in all aspects of our operations, and abiding by the Sharia principles. Empower our employees by inspiring, guiding, enabling and supporting them.

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Core Values

Following values are upheld in the entire operations of Watania and in the day to day activities of its employees.

Integrity Honesty and ethical behavior guides the way Watania employees conduct business whether with external or internal parties.

Reliability Watania conveys the image of being a reliable business partner through all business dealings with all stakeholders.

Loyalty Watania is loyal to its shareholders, policyholders and employees and keep exceeding their expectations.

Excellence Watania recognizes and rewards excellence in the workplace. Performing at the highest level requires Watania employees to think in the best interest of shareholders.

Transparency Watania is transparent in dealings with policyholders, retakaful operators and vis-à-vis the Insurance Authority.

Fairness Watania values its employees, partners and the community it is part of. Watania is dedicated to fair treatment with all stakeholders.

Teamwork Watania encourages teamwork among employees to achieve synergies and make efficient and goal-oriented decisions.

Innovation Watania strives to be the leader in providing innovative takaful solutions to its clients and commit to developing new products that anticipate customers’ needs.

Customer centricity Watania is committed to its clients and strives to understand their needs, and ensures that delivered products and services exceed their expectations.

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Governance & Management

Board of Directors

. Mr. Khaled Abdulla Al Khouri Chairman . Eng. Abdul Rahman Awad Ba Omar Vice Chairman . Mr. Fahad Ahmed Al Shaaer Member . Dr. Mohamed Ali Al Barwani Member . Mr. Hamad Saeed Sultan Al Dhaheri Member . Eng. Khamis Mubarak Al Kiyumi Member . Mr. Saif Ali Mohamed Al Shehhi Member

Sharia Committee

Watania's Sharia Supervisory Committee comprises of the following respected scholars:

Dr. Ahmad AbdulAziz Al Haddad – Director of Islamic Affairs & Charitable Activities department in Emirate of Dubai. He is also member of several Islamic institutions in the Islamic world.

Dr. Mohamad Akram is currently the Executive Director of International Sharia Research Academy for Islamic Finance (ISRA). He is also the member of Central Bank of Malaysia Sharia Advisory Council, member of IIFM Sharia Advisory Board, member of IFSB Working Committee, member of AAOIFI Standard Committee, member of HSBC Amanah Global Sharia Advisory Board, member of Yassar Limited (Dubai), Member of Islamic Advisory Board of HSBC Insurance Singapore, and other Boards locally and internationally. Dr. Akram holds a B.A. Honors degree in Islamic Jurisprudence and Legislation from the University of Jordan, Amman, and a Ph.D. in Principles of Islamic Jurisprudence (Usul al-Fiqh) from the University of Edinburgh, Scotland.

Dr. Ghassan Taher is the head of Sharia compliance division of ADNIF. He has vast experience in Islamic banking in UAE and Saudi Arabia since 1999. He holds a Master degree in Islamic Economics from Yarmuk University Jordan and an honorary doctorate from Mahmood Gashghary University Kyrgyzstan.

Management Team

. Oussama Kaissi Chief Executive Officer . Sherwit Atwa Head of Human Capital & Business Support . Pervez Rizvi Chief Finance Officer . Mohammed Hamdan Head of Legal & Shariah Compliance . Khalil Hazeem Head of Strategic Planning & Development . Mamdouh Malkawi Head of General Takaful . Ahmed Majeed Head of Retakaful . V. Murali Head of Technical - Dubai . Hassan Jaber VP Business Development

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Watania Takaful Model

In Watania’s Takaful Model premiums are paid as voluntary contributions into a risk pool called as “Takaful Fund” to collectively cover the losses of the participants. Policyholders and/or participants collectively own the Takaful Fund, whereas, Watania manages the fund according to Wakala model and receives fees.

Investments are made in sharia compliant instruments and returns are Riba free. Watania is committed to channeling funds to industries, businesses and activities that are good for society and environment. Policyholders, as owners of the Takaful Fund, are entitled to its profits.

Management of Takaful Fund

When participant pays contribution, a fee is deducted upfront from the contribution and that fee is paid to the Shareholders Fund under the Wakala contract. The balance of the contribution is paid into the Takaful Fund. Claims, retakaful contributions and acquisition cost are paid out of the Takaful Fund, whereas investment profits and recoveries are added to the Takaful Fund.

Shareholders’ Fund is responsible for meeting operating expenses of Takaful Fund. Some portion of the investment profits of Takaful Fund goes to the Shareholders’ Fund as fee under the Mudaraba contract. If there is a deficiency in the Takaful Fund, a Qurd-al-Hasan (interest free loan) is paid from the Shareholders’ Fund into the Takaful Fund to cover the deficit.

After setting aside reserve for stabilizing future surplus and paying the performance fee to the Shareholders’ Fund, any surplus in the Takaful Fund is paid back to the participants. Watania may put aside part of this surplus as reserve to strengthen the claim paying ability of the Takaful Fund.

Watania Fees / Charges

Watania, acting as manager of Takaful Fund, is entitled to receive fees. This is expressed as:

. percentage of Gross Contribution as upfront fee – Wakala Fee . percentage of policyholders investment income – Mudaraba Fee . percentage of underwriting surplus after accruing minimum set percentage – Performance Fee

Watania Fees do not exceed maximum limits as agreed with its Sharia Committee at the beginning of each year.

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Watania Products

Watania offers a range of takaful plans to meet individuals and corporate protection needs for general and medical line of businesses. All Watania products are reviewed and approved by its Sharia Supervisory Committee.

Motor

Comprehensive This policy covers a vehicle and its accessories against loss or damage caused accidentally and unintentionally by the policyholder or the driver of the vehicle. This policy includes Third Party cover as mentioned below.

Third Party This policy is compulsory by UAE Law. It provides coverage for amounts that the owner of the vehicle may be legally liable for in respect of:

Death of or bodily injury to any person including all passengers in the vehicles (except the policyholder, his spouse or the driver)

Property damage (except those owned by the policyholder or the driver at the time of accident or property that has been entrusted to the policyholder or is in his custody or control)

Property

Property All Risk This policy is suitable for large, commercial and industrial risks. All risk policy provides a broader coverage than Fire & Allied Perils policy. This policy covers accidental loss or damage to the covered property.

Fire & Allied Perils This policy covers property such as buildings & contents (residential, commercial, and/or industrial) against the fire, lightning and allied perils.

Fire & Lightning This policy covers material damage of the covered property resulting from fire and lighting. However, it specifically excludes any consequential loss.

Household This policy provides coverage to residential building and its contents and covers the loss of property due to fire, lightning, burglary or housebreaking, storm, tempest, flood, explosion and the like.

Business Interruption This policy covers loss of net profit on account of interruption of business, consequent upon material damage to property due to fire or any other perils under the standard Fire & Allied Perils or All Risk policy. This policy includes cover for increased cost of working following the loss, as well as the standing charges of the business.

Casualty

Public Liability This policy covers accidental bodily injury to a third party caused by the policyholder in the course of business; and accidental loss or accidental damage caused by the policyholder to property owned by third parties.

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Public & Products Liability This policy indemnifies the policyholder against legal liability to pay compensation arising out of any defect in the products manufactured by the policyholder and covered under the policy.

Workmen's Compensation This policy covers the liability of the employer towards his employees as defined under UAE Labour Law in respect of personal injury by accident or occupational disease in the course of the employment with the policyholder.

Workmen's Compensation & Employer's Liability This policy covers the legal liability of the employer towards his employees in addition to the liability defined under UAE Labour Law in respect of personal injury by accident or occupational disease that may occur during and in the course of employment with the policyholder.

Medical Malpractice This policy provides cover for claims against medical professionals committing malpractice. It offers protection to those medical professionals who may become liable to pay compensation due to any unintentional human error, omission, or negligence while providing their services to patients.

Marine

Marine Cargo – Open Cover Any goods that are loaded onto any type of vehicle for the purpose of transportation from one point to another are covered under cargo takaful policy.

Cargo Marine – Single Shipment This policy is designed for the shipments of goods by vessels or by air for only one journey and the cover expires upon the arrival of the goods to the destination as mentioned in the policy.

Marine Hull This policy provides comprehensive cover on all types of vessels like oil tankers, dry cargo carriers, livestock carriers, fishing vessels, and pleasure yachts etc.

Inland Transit This policy covers loss or damage to the cargo caused by or resulting from fire, crash, overturning, collision, derailment and dropping out of vehicle/carriage carrying the cargo.

General Accident

Personal Accident This policy covers accidental death or disablement to the Assured within the geographical limits that are specified in the policy.

Travel This policy is uniquely designed for individual or group business travelers by offering coverage for travel related concerns like trip cancellation, theft, and loss of baggage and business effects.

Money This policy provides cover for loss of money in transit between the policyholder's premises and the bank or post office, or other specified places caused by robbery, theft or any other fortuitous cause. The policy also covers loss by burglary or housebreaking whilst money is retained at the Policyholder's premises in safe(s) or strong room.

Fidelity Guarantee This policy covers loss of money or goods belonging to the policyholder against a direct pecuniary loss sustained by reason of any act of fraud/dishonesty of employees.

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Plate Glass This policy covers the cost of the accidental and unintentional breakage of glass through any cause other than the exclusions specified in the policy.

Engineering

Contractors’ All Risks (CAR) This policy covers damage to any contract works including construction plant and equipment, third party property, surrounding property etc. There are two kinds of Contractors All Risk policies; (1) annual policies for contractors handling many small, medium to large contracts of a similar nature, and (2) a single contract policy for specific contracts.

Erection All Risks (EAR) This policy covers the risks associated with storage, assembly/erection and testing and commissioning of plant and machinery. The policy can be extended to cover third party liability exposures.

Contractor’s Plant & Machinery (CPM) This policy covers construction plant and machinery against sudden and accidental damages or destruction caused by external influences and occurring within the construction site.

Electronic Equipment (EE) This policy covers damage to electronic equipment, damage to policyholder's inputted data and records, and the costs incurred to retrieve and recover the lost data.

Machinery Breakdown (MB) This policy covers loss or damage to machinery caused by defects in casting and material, faulty design, bad workmanship, lack of skill, carelessness, shortage of water in boilers, physical explosion, short circuit or storm.

Loss of Profit following Machinery Breakdown (MLoP) This policy provides cover for the actual loss of profits sustained as a result of business interruption caused by an accident indemnified under Machinery Breakdown policy.

Deterioration of Stock (DOS) This policy is a form of consequential loss cover, especially available for stocks contained in cold stores. Cover will be for loss or damage to the machinery specified in the list of machinery declared in the proposal form.

Boiler & Pressure Vessel (BPV) This policy is designed for boilers in industries and factories. It provides cover for boilers and pressure vessels against the explosion or implosion. The policy also covers damage to surrounding properties and liabilities for injury to third parties or damage to third party property.

Health

Group and individual Medical Watania has a wide range of products for individuals and families; and for the corporate customers, Watania has the ability to design cover according to their specific needs ranging from basic to international cover with comprehensive benefits and direct billing facility over a wide network of local, regional and international medical providers.

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Achievements in 2014

AM Best Rating

Rating team of AM Best visited Watania office in February 2014 for a daylong surveillance visit as a result of which they maintained Watania’s financial strength rating of B+ (Good) and Issuer Credit Rating of BBB- with a stable outlook for 2014-15 as well.

Watania is amongst very few companies who were able to achieve investment grade rating without much track record purely on the strength of its balance sheet, management team, and advanced risk and quality management structure in place. The B+ rating helped Watania to compete in the market place on equal footings.

Quality Management System

Watania’s Quality Management System (QMS) which was implemented in 2013 was further enhanced through various quality review and audits throughout 2014.

ISO 9001:2008 Certification

In July 2014 Watania went through a quality surveillance audit by Lloyd’s Register Quality Assurance Limited in which no major non-conformance was reported and hence the ISO 9001:2008 certification was maintained.

Among the perceived benefits of using the standards are:

. Satisfies the demands of current and prospective customers . Improves customer focus and process orientation within the organization . Facilitates continual improvement in the efficiency and effectiveness of an organization . Creates consistency throughout the organization . Strengthens relationships amongst organization , suppliers and customers . Provides confidence to customers with regard to capability of organization to meet quality commitments . Improves management decision-making . Institutionalizes training . Reduces dependence upon individuals . Provides access to markets

Risk Management Framework

In 2014 various risks review meetings were held to discuss and rate various open risks recorded in Risk Register and to analyze the steps taken to mitigate the risk. Each risk control measure then vetted by business managers, thereby ensuring operational control. In Watania risks are periodically reviewed to ensure continuous effectiveness of the existing control measures and early identification of new risks faced by the Company.

Desktop analysis carried out periodically to monitor the risk appetite of the Company.

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Award / Recognition

Best Islamic Insurance Provider UAE 2013

In October 2014, Watania was awarded once again as “Best Islamic Insurance Provider UAE 2014” by Global Banking & Finance Review.

The Global Banking and Finance Review Awards were created to recognize companies of all sizes that are prominent in particular areas of expertise and excellence within the global financial community. The awards are known throughout the global banking and financial community. They reflect the innovation, achievement, strategy, progressive and inspirational changes taking place within the financial sector.

The entire awards process includes nomination, selection and announcement under the Award Winners section. Award nominations in the various awards categories are received from the readership and from individual companies themselves through written submissions or by way of on- line nomination form throughout the calendar year.

Initially, a research team scrutinizes a nomination to ensure that it meets the specific criteria for an Award in the selected category. If it does, then the judging panel, comprising the research team, the editor and the publisher evaluates it along with the other nominations received for that award category and on their reasonable judgment select a winner.

Business Highlights

. Watania achieved Gross written Contribution of AED 191 m in 2014 showing a growth rate of 48% compared to 2013. . Watania achieved Gross Written Contribution of AED 129 m in 2013 against a budget of AED 110 m. (+17%) . Growth from 1st year of operation to 2nd year of operation is 200%.

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