MANILA, Philippines — Pru Life UK is setting its sights on the 2.5 million Muslim Filipinos who have the capacity to pay for insurance, as the insurance company moves to expand its reach in the underserved Islamic finance segment through its newly launched Takaful product.

The figure came from a study commissioned by Pru Life UK, which found that only 2.5 million out of the Philippines’ estimated seven million Muslims can afford insurance or its Shari’ah-compliant counterpart.

“This is the base market we are looking at for Takaful in the Philippines,” Pru Life UK vice president for sustainability Maricel Estavillo said.

“But our target for the first year is not just to sell the product but to raise awareness and understanding of Takaful as part of supporting the government’s objective of promoting Islamic finance,” she said

Earlier in June, the insurer launched its maiden Takaful product Lindungi under the Insurance Commission’s “Takaful window” framework.

Lindungi is a one-year term product that provides P100,000 in benefits, designed to be simple and accessible to encourage mass adoption.

“So far, the take-up has been very encouraging. But since this is a new product and a new concept, we need to continue investing in education and awareness,” Estavillo said.

As of September, nearly 300 Pru Life UK agents have been trained and certified to sell Takaful out of the company’s 40,000-strong sales force. Many of the early batches are based in Mindanao, following pilot training in Davao and Cagayan de Oro

Estavillo declined to disclose the peso value of contributions but noted that 55 percent of premiums go directly into the Tabarru’ fund, which serves as a pool for paying claims.

The remaining 45 percent is allocated to the Wakalah Bil Ujrah, an agreement between Pru Life UK and policyholders that allows the insurer to use this portion of contributions for managing the Tabarru’ fund and covering administrative expenses.

The Tabarru’ fund has yet to be invested as the company waits for it to reach scale.

“Right now, Shari’ah-compliant investment instruments remain limited. But the regulations do not prohibit Takaful operators from investing overseas. We can do it locally or abroad depending on management decisions,” Estavillo said.

Mehol Sadain, Pru Life UK’s Takaful consultant, explained that strict prohibitions govern how funds can be invested.

“You cannot trade in alcohol, pork or related products, gambling, ammunition, tobacco, or anything that destroys,” he said.

Estavillo admitted that Lindungi’s viability depends on achieving sufficient scale given the relatively small contributions required from participants.

“It’s really a mass-led game. If claims exceed contributions, there is a possibility of tapping shareholder support through benevolent loans,” she said.

Estavillo stressed that Pru Life UK is on track, with strong enthusiasm from agents to promote the product.

Globally, the rollout of Takaful products typically takes two to three years before gaining momentum, Estavillo noted.

“We feel like there’s also a wait-and-see in the local industry. Hopefully by 2027 or 2028, we can see more companies applying for Takaful windows and offering more options not only for Muslim Filipinos but also for the broader population,” she said.