Capita in Shariah compliant MGA start-up

The business has taken a minority equity stake in the MGA's holding company, Cobalt Insurance Holdings and as part of the transaction Capita will provide business outsourcing services for a minimum of five years.

According to Capita, Cobalt offers Shariah compliant commercial insurance lines of business including selected property and casualty lines, marine and trade credit. The insurance capacity is provided by XL Group in London.

Capita claimed the development marked an important step forward in providing Shariah compliant insurance coverage for the Islamic market.

Investment strategy
The company also confirmed that the investment was the first in its strategy to build a portfolio of minority equity stakes in MGAs combined with business process outsourcing (BPO) contracts.

John Holm, executive director, Capita Insurance Services, commented: "This is a very positive development both for the London insurance market and for Capita and we are delighted to be able to help bring to the market a unique business with a highly differentiated offering.

"The MGA space is currently extremely active and there will be many more opportunities for Capita Insurance Services to invest in talented underwriting teams, allowing them the freedom to establish or grow their businesses on their own terms, while we take care of their non-core operations."

Market changing
Richard Bishop, chief executive officer, Cobalt Underwriting Services, added: "We are delighted to have the support of Capita, which is not only a significant investor in Cobalt but will also deliver market-leading administration and processing support.

"We believe what Cobalt is aiming to deliver will change the market and enhance access to Shariah compliant insurance and reinsurance capacity."

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