Dawood Family Takaful Limited ("DFTL" or the "Company") was incorporated in Pakistan as a public unlisted company on May 4, 2007, under the Companies Act, 2017 (previously the Companies Ordinance, 1984). The Company received its certificate of registration from the Securities and Exchange Commission of Pakistan (SECP) on May 16, 2008, to undertake family takaful business in accordance with the Insurance Ordinance 2000 and Takaful Rules, 2012.

DFTL belongs to BRR Group of Companies, a diversified conglomerate with expertise across various sectors, including finance,and Asset Management Company / Mutual Fund Industry. The Company commenced its takaful operations in 2008 and has since established itself as a notable player in the family takaful segment. The Company operates on the Waqf-Wakala model, managing funds for its participants through the Participant Takaful Fund (PTF) and Participant Investment Fund (PIF).

DFTL's primary business activity is to provide family takaful solutions, offering a range of unit-linked individual and family takaful plans. As part of a strategic branch-network efficiency exercise, the Company rationalized its distribution footprint to 56 branches as of Dec-25 (Dec-24: 74 branches), focusing on strengthening its presence in key provinces such as Punjab, KPK, and Sindh. The Company is also enhancing its digitalization efforts, including the introduction of the SARMAYA mobile app and an Agent mobile app, and broadening its bancatakaful partnerships to improve accessibility and service delivery.

The ownership structure of the Company reflects strong sponsor support from the Dawood Group. As of end-Dec25, associated companies, undertakings, and related parties collectively held 36.61% of the shareholding, led by The Bank of Khyber (15.00%), BRR Guardian Limited (13.03%), and B.R.R Investments (Private) Limited (8.58%). Directors held 16.10% of the shares, while the general public accounted for 14.65%. Banks, Development Financial Institutions (DFIs), and Non-Banking Financial Institutions (NBFIs) maintained a stake of 4.67%. The remaining 27.97% was held under the “Others” category, comprising joint stock companies (11.26%), foreign companies (8.09%), and other investors (8.61%). The ownership profile is considered stable and diversified, while continued support from the sponsoring group remains a key strength for the Company.

The ownership is considered stable. The Group's long-term association and continued support provide a solid foundation for the Company's strategic and financial objectives.

The sponsor, BRR Group, possesses robust expertise and a diversified business portfolio, offering substantial support to the Company. The Group's deep understanding of the financial sector and its reputation for governance provide strategic direction and stability to DFTL's operations.

The ownership structure provides a strong financial foundation, enabling agile decision-making and aligned strategic growth.

The overall control of the Company rests with a seven-member Board of Directors (Board). The Board comprises four Non-Executive Directors, including one nominee each of The Bank of Khyber and BRR Guardian Limited, two Independent Directors, and one Executive Director serving as the Chief Executive Officer. The composition of the Board provides an appropriate balance of sponsor representation, independent oversight, and executive management, thereby strengthening the Company's governance framework and decision-making process.

Mr. Ayaz Dawood – Chairperson – Holds an MBA in Finance and Money & Financial Markets from Columbia Business School, New York. He serves as the Chief Executive Officer of BRR Guardian Limited and has been associated with the Board for over 12 years, bringing extensive experience in strategic leadership, corporate governance, and investment management. Ms. Tara Uzra Dawood - Non-Executive Director – Holds qualifications from Harvard Business School and Harvard Law School (J.D. equivalent of LLB). She is the Chief Executive Officer of 786 Investments Limited and brings valuable expertise in investment management, corporate governance, and strategic business development, with six years of association with the Board. Mr. Muhammad Rizwan-ul-Haque - Non-Executive Director – Holds an MBA from the University of Punjab and serves as the Chief Executive Officer of First Dawood Investment Bank Limited. With over 16 years of association with the Board, he contributes extensive experience in investment banking, financial services, and corporate management. Mr. Abdul Wahid Dewani - Independent Director – Holds a Bachelor of Commerce degree and possesses over 24 years of professional experience across Islamic banking, insurance, and takaful sectors, primarily in finance, administration, and operations. He has served on the Board for over three years, providing independent oversight and industry expertise. Mr. Sohail Razi Khan - Independent Director – Holds a PhD, an MBA in Business Administration & Project Management, and an MSc in Computer Science. As a businessman with diversified professional experience, he contributes independent judgment and strategic insight to the Board and has been associated with the Company for over two years. Mr. Mudassar Iqbal - Non-Executive Director - Nominee of The Bank of Khyber – A CA-Inter, Certified Internal Auditor (CIA), and DAIBP-qualified professional, Mr. Iqbal serves as Head of Internal Audit at The Bank of Khyber. He brings expertise in audit, risk management, internal controls, and banking operations, and has been associated with the Board for over one year.

During CY25, the Board met four times, with full attendance by all seven Directors, reflecting a high level of engagement and oversight. The Board is supported by three key committees: (1) Investment Committee, (2) Audit Committee, and (3) Ethics, HR, Remuneration & Nominations Committee. These committees meet regularly to focus on specialized areas, ensuring robust governance and risk oversight

The External Auditor, M/s BDO Ebrahim & Co., Chartered Accountants, has expressed an unqualified audit opinion on the Company's financial statements for the year ended Dec-25. The audit firm is QCR rated and is on the State Bank of Pakistan's panel of auditors, which provides comfort regarding the quality and integrity of the financial reporting process.

The Company operates through Retail, Distribution & Marketing, Actuarial Services, Finance, Internal Audit, Risk & Compliance, Training & Development, HR, Investment, Risk Management, IT, and Operations. The head of Human Resources reports to the COO. COO and all the Heads report to the CEO, who then reports to the Board.

The Company is led by an experienced management team with extensive expertise in takaful, finance, operations, and risk management. Mr. Ghazanfar-ul-Islam - Chief Executive Officer (CEO), a Fellow Chartered Accountant, possesses over 27 years of professional experience and has been associated with the Company for nearly 17 years, including more than 8 years as Chief Executive Officer. Mr. Muhammad Asif Haque - Chief Operating Officer (COO), brings over 27 years of experience, with more than 18 years at the Company, and has played a key role in operational management, technology integration, and business development. Mr. Nabeel Asif - Chief Financial Officer (CFO), an FCCA and Certified Internal Auditor (CIA), has over 26 years of diversified experience in finance, audit, and corporate governance, strengthening the Company's financial management and control framework. The long-standing association and industry expertise of the senior management team support operational stability and the effective execution of the Company's strategic objectives.

The Company has four management committees, namely: i) Underwriting Committee, ii) Claims Settlement Committee, iii) Risk Management & Compliance Committee, iv) Re-takaful Committee. All of these committees are headed by the Executive Director and meets every quarter, and meeting minutes are adequately maintained.

The Company maintains a strong focus on timely and efficient claims settlement, which remains a key element of its participant service proposition. The claims administration process is supported by an in-house operating system that facilitates efficient claim registration, assessment, and settlement. Claims against the Waqf Fund are recorded upon notification by participants, while the allocation of the retakaful operator’s share is automatically determined through the system. Claims relating to the Participants’ Investment Fund (PIF) are processed through partial or full redemption of units held in the Participants’ Investment Account (PIA), ensuring a streamlined and transparent settlement mechanism.

The Investment Committee remains responsible for the implementation, modification, and execution of investment policy. The Waqf fund continues to invest predominantly in low-risk securities, primarily comprising government securities. The high concentration of the investment portfolio in risk-free government securities reflects a conservative investment strategy aligned with the Company's risk profile. 

The Company maintains a department-driven risk management framework, whereby each functional area operates within a defined risk tolerance approved by the CEO. Risk management processes are supported by an in-house developed operating system that facilitates underwriting, claims administration, retakaful transactions, policy servicing, and management of unitized investment funds. The system operates on a real-time basis and is supported by the Oracle platform, enhancing operational efficiency, data integrity, and risk monitoring capabilities. The Board oversees the overall risk management framework in accordance with regulatory requirements, while the Management Risk Management & Compliance Committee is responsible for monitoring and mitigating key business risks across the organization. 

The life insurance sector in Pakistan recorded Gross Premium Written (GPW) of PKR ~496.9bn in CY25, up ~13.8% YoY, driven by strong growth across both public and private segments. The public segment remained dominant with a ~58.6% share (PKR ~291.2bn, +8.8% YoY), while the private segment outpaced growth at ~21.7% YoY to PKR ~205.7bn, increasing its share to ~41.4%. Despite sustained expansion, the sector remains underpenetrated versus regional peers, though growth is supported by improving macroeconomic conditions, rising bancassurance penetration, and regulatory reforms including IFRS 17 and risk-based capital framework enhancements. The premium mix continued to shift toward quality, with individual regular premiums rising to ~52.8% (CY24: ~47.7%) amid lower inflation and improved purchasing power, while group business moderated to ~38.1% and single premiums declined to ~9.1%. On the claims side, gross claims increased ~7.3% to PKR ~412.7bn, with a decline in surrender claims to ~40.5% reflecting improved retention, while maturity and death claims increased with a growing in-force portfolio. The sector’s investment portfolio remains predominantly concentrated in government securities, mainly Treasury Bills, Pakistan Investment Bonds (PIBs), and Sukuks. This allocation reflects a regulatory-driven and risk-averse investment strategy focused on capital preservation, liquidity management, and stable long-term returns. Sector profitability remained broadly stable at PKR ~23.7bn (-0.8% YoY), as strong premium growth was offset by a ~13.5% decline in investment income due to monetary easing and a sharp reduction in policy rates.  (Source: PACRA Sector Study)

Dawood Family Takaful continues to operate as a small but growing player within the life insurance and family takaful segment. Its market share, while modest, has been on a positive trajectory, driven by its focused strategy on individual takaful products and its growing presence in key geographic regions. 

During CY25, Dawood Family Takaful demonstrated a strong performance in revenue growth and profitability. While specific persistency rates are not disclosed in the annual report, the significant increase in renewal business indicates a stable in-force book. The Company observed an achievement of 20.7% growth in total contributions, showing a significant increase in first-year along with renewal business. This growth in renewal business is a positive indicator of the Company's ability to retain its policyholder base and sustain premium inflows.

During CY25, Dawood Family Takaful recorded Gross Total Contribution of ~PKR 2.6bln (CY24: ~PKR 2.2bln), reflecting growth of ~20.7% year-on-year. Revenue generation continued to be supported by both individual and group Takaful plans. Total individual contribution of ~PKR 2.4bln showed an increase of 20.8% (CY24: ~PKR 1.9bln), whereas total group contribution increased to ~PKR 252.6mln, showing a growth of 20.5% (CY24: ~PKR 209.6mln). Net contribution revenue after retakaful ceded stood at ~PKR 1.9bln (CY24: ~PKR 1.6bln). Going forward, revenue momentum is expected to be sustained by the Company's ongoing expansion across its branch network and the planned launch of new unit-linked products in 2026 to cover untapped market segments.

During CY25, Dawood Family Takaful's profitability strengthened significantly. The Company reported a profit before tax of ~PKR 356mln (CY24: ~PKR 347mln). Profit after tax increased substantially to ~PKR 307mln (CY24: ~PKR 285mln). The Company reached a benchmark for the first time where profits are now assessed under the Normal Tax Regime instead of the Minimum Tax Regime. Going forward, sustained investment income and disciplined expense management will be critical to maintaining this profitability trajectory.

During CY25, Dawood Family Takaful maintained a growing investment book, with total investments reported at ~PKR 10.6bln (CY24: ~PKR 9.2bln), reflecting year-on-year growth of ~14.5%. The portfolio is diversified across Shariah-compliant equity and debt securities, including bank deposits and GOP Ijarah sukuk. Total investment income for CY25 amounted to ~PKR 818.3mln (CY24: ~PKR 1,072.5mln). The decline was attributable primarily to lower returns on government and debt securities. However, the Company's funds delivered strong annualized returns, with the DFTL Aggressive Fund returning 26.6% and the DFTL Balanced Fund returning 12.8%. Effective investment book management remains essential to yielding consistent income going forward.

Dawood Family Takaful continues to focus on strengthening its presence in Punjab, KPK, and Sindh, enhancing digitalization (including the SARMAYA mobile app, Agent mobile app, and Single Sign-On authentication), and broadening its Bancatakaful partnerships, while pursuing distribution efficiencies through branch-network rationalization.

Dawood Family Takaful's has believed in the philosophy of prompt claim settlement. Outstanding claims increased to ~PKR 362.1mln as of CY25 (CY24: ~PKR 270.1mln), reflecting the growing scale of the business. The rising claims burden, particularly in unclaimed maturity benefits which increased to ~PKR 220.9mln (CY24: ~PKR 128.1mln), remains an area requiring close monitoring.

Dawood Family Takaful continues to maintain comprehensive reinsurance treaty arrangements with two globally recognized, highly-rated reinsurers: Munich Re (AA- by S&P) and Hannover Re (AA- by S&P). The quality of these counterparties is a key credit strength, as it ensures a high certainty of recoveries and protects the Company's solvency in the event of large or catastrophic claims. The Company's risk retention policies are designed to be prudent and aligned with its risk appetite.

During CY25, Dawood Family Takaful's liquidity position remained adequate, with the investment portfolio predominantly anchored in liquid government securities. Liquid investments — comprising government securities and cash and bank balances — stood at ~PKR 6.5bln (CY24: ~PKR 5.4bln). Net cash flows from operating activities showed an outflow of ~PKR 66.2mln (CY24: inflow of ~PKR 29.4mln), primarily due to higher cash outflows from investment activities. The Company's liquidity framework is further supported by regular contribution receipts across its branch network.

As of CY25, shareholders' equity increased to ~PKR 732.2mln (CY24: ~PKR 633.4mln), reflecting a year-on-year increase of ~15.6%, driven by profit retention. Paid-up share capital remained stable at ~PKR 750mln same as last year, which is in line with the minimum paid-up capital requirement of PKR 700mln. The strengthened equity base provides enhanced capacity to support the Company's growing policyholder liabilities and underpins its ongoing business expansion. Going forward, continued profitability and retention of earnings are expected to maintain the Company on a sound capital trajectory. Management has communicated a formal capital enhancement plan comprising a PKR 250 million right issue and a subsequent PKR 500 million capital raise through an IPO by December 2026. In support of the proposed capital strengthening measures, they evidencing their commitment to inject the planned capital and support the Company's growth and regulatory capital requirements