Swiss insurer Zurich Financial Services has signed a joint venture with an Abu Dhabi-based partner to offer Islamic insurance cover known as "takaful".

Takaful is a form of cooperative insurance designed to provide insurance cover that conforms to Islamic Shariah rules and principles. The new Zurich Takaful Company is to be based in Dubai.

Zurich will control 51 per cent of the joint venture company, while the remaining 49 per cent will be held by the Abu Dhabi National Takaful Company.

It was formed five years ago as the first takaful operator in the United Arab Emirates.

Zurich notes that a distinctive feature of takaful is transparency concerning profits, its elements of profit sharing and strict selection criteria on acceptable investments.

It adds that in addition to the growing demand from Muslim customers, there is also a rising interest in takaful products from non-Muslim investors, who are looking out for ethical investments.

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