Microinsurance and Takaful - Revision history

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1st Asian Conference on

Microinsurance

July 25-26 2007

Overview of presentation

 About ICMIF

 Overview of the cooperative and mutual

sector

 Microinsurance through cooperatives

 Opportunities and need for microtakaful

Cooperative definition

“A cooperative is an autonomous

association of persons united

voluntarily to meet their common

economic, social, and cultural

needs and aspirations through a

jointly-owned and democratically

controlled enterprise”

Cooperative/mutual values

 Self-help, self-responsibility

 Democracy, equality, equity

 Solidarity

 Honesty, openness

 Social responsibility, caring for others

Cooperative vs. Mutuals

Cooperative principles Mutual principles

Open and voluntary Free association

membership

One member, one vote User must be

member

Limited interest on shares "Not for profit”

For the benefit of user- Quality products

members

Cooperative education Personal

development

Why a cooperative/mutual?
Cooperatives and Mutuals: the

hidden giants of the world

economy

The largest 300 cooperatives

and mutuals have a turnover

of

1 trillion USD

Worldwide importance of mutual insurers, 2001

ESTIMATES

Percent of total premiums

100% = 2416 bio USD

USA

32

EUR

21

CAN

25 19

JAP

16

KOR

14

Source: Swiss Re for worldwide total premium; ICMIF

Providing microinsurance

The challenges

 Coverage

 Regulation

 Moral hazard and Fraud

 Adverse selection

 Education and trust

 Technical expertise

 Affordability

 Retention

 Sustainability

 Penetration

Potential for cooperatives to

provide microinsurance

 History of organising the poor

 Operate for the interest of members by

members

 Trust

 Ownership and loyalty

 Peer pressure

 Surplus reinvested or redistributed

Cooperatives providing

microinsurance

 CARD MBA – The Philippines

 Sanasa Insurance Company – Sri Lanka

 Centre D’Innovation Financiere – West

Africa

 Columna - Guatemala

 Torreon - Mexico

Challenges

for microinsurance cooperatives

 Regulatory requirements

 Accessing reinsurance

 Technical and financial investment

The way forward?

 Maintain informal operations

 Merge with other providers

 Enter into a partner-agent agreement

 Lobbying regulators

Microtakaful:

Opportunities and need

Principles of Takaful

 Solidarity and joint guarantee

 Self reliance and self sustaining for

community well being

 Assist those that need assistance

 Community pooling system

 Shari’ah approved investments and products

“Bear ye one another’s burden”

The Global Takaful sector

 1979 First Takaful Company established

 1996 – 30 Institutions transacting Takaful

 2002 – 50 Takaful operators and four Retakaful

providers

 2004 – 80 Takaful operators, 200 Takaful

windows and 12 Retakaful providers

Source: IBB Solicitors, UK – (2005)

The need for microtakaful

 Social services inadequate or unavailable

 Large sectors of poverty in many Muslim

countries

 Over half of world’s lowest developed

countries have a majority Muslim population

 Increasing inequality in Middle East and Gulf

countries

 Religious considerations are important in

villages and small communities

 Established Takaful sector neglecting low

“A noticeable lack of microinsurance

in North Africa and the Middle East.

In no other region is the absence

of microinsurance so evident”

Source: The Landscape of

Microinsurance

(The Microinsurance Centre)

second most

important social

institution to

counter poverty

and deprivation”

Omar Fischer

1999

“A cooperative and mutual scheme

providing Shari’ah approved

products and investments is

permissible under Islamic Law”

Possibilities for

microtakaful

 Establish community based microtakaful

schemes

 Involvement of NGOs, zakat funds,

donor agencies

 Support from Takaful sector

 Technical expertise

 Financial assistance

 Partner-agent model

Microtakaful in practice

 Agricultural Mutual Fund - Lebanon

 Amana Takaful – Sri Lanka

 Takaful Ikhlas

 Takmin - Indonesia

The case of a microtakaful

policyholder

 Ibu Iwit, 50 years, farmworker, earning

one dollar a day.

 Took out a 6 month loan of 55 USD

from local Baitul mal Wat Tamwil

 Insurance premium was taken out with

Takmin at 0.16 USD

 Ibu Iwit passed away a couple months

later

 Her husband, Amad, age 60 years, no

income

Summary

 Cooperatives have for many years being

providing insurance to the underserved

population.

 There is a need to find avenues to facilitate

the sustainable growth of the informal sector

operators.

 The philosophy and principles of Takaful are

similar to cooperatives.

 Takaful requires the needy to be given

protection.

 There is a need for microtakaful in many

A Global reach for

local strength

Thank you

www.takaful.coop

← Older revision		Revision as of 04:52, 10 November 2017
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−	[~~http~~://45.40.~~136.134~~/~~~hodhood~~/HodHoodDocuments/IslamicFinance/Takaful/Microinsurance%20and%20Takaful.pdf Read the Full Document]	+	[https://www.hodhood.com/en/HodHoodDocuments/IslamicFinance/Takaful/Microinsurance%20and%20Takaful.pdf Read the Full Document]

← Older revision	Revision as of 02:27, 21 September 2016
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	+
	+
	+	== Top 20 FREQUENT WORDS ==
	+	takaful 14
	+	microinsurance 10
	+	cooperative 8
	+	cooperatives 8
	+	microtakaful 7
	+	mutual 6
	+	sector 5
	+	principles 4
	+	providing 4
	+	social 4
	+	usd 4
	+	community 3
	+	countries 3
	+	insurance 3
	+	members 3
	+	mutuals 3
	+	operators 3
	+	products 3
	+	providers 3
	+	source 3
	+	technical 3
	+	years 3
	+
	+
	+
	+	== DOCUMENT KEY POINTS ==
	+	*mutuals cooperative principles mutual principles open and voluntary free association membership one member one vote user must be member limited interest on shares not for profit for the benefit of userquality products members cooperative education personal development
	+	*cooperative vs
	+
	+	*in no other region is the absence of microinsurance so evident source the landscape of microinsurance the microinsurance centre
	+	*a noticeable lack of microinsurance in north africa and the middle east
	+
	+	*i R took out a month loan of usd from local baitul mal wat tamwil i R insurance premium was taken out with takmin at
	+	*usd i R ibu iwit passed away a couple months later i R her husband amad age years no income
	+
	+	*i R there is a need to find avenues to facilitate the sustainable growth of the informal sector operators
	+	*summary i R cooperatives have for many years being providing insurance to the underserved population
	+
	+
	+	''Please note, This is an auto generated summary based on sentances position in the document and other factors''
	+	== DOCUMENT WORD ANALYSIS ==
	+	=== Main Category ===
	+	: AlHuda Material\takaful
	+
	+
	+	=== KeyWords ===
	+	taka islam insur malaysia productdeferred shariah countries muslim financial retakaful model growth custom partner developed service mutual bankable provided scheme
	+
	+
	+
	+	== RELATED DOCUMENTS ==
	+	:[[A Review of Takaful by Prof. Khawaja Ahmed Saeed]]
	+	:[[Agency Management,Training and Incentive Programme]]
	+	:[[Audit Issue of Islamic Banking]]
	+	:[[Banca Takaful by Faisal Shahzad Abbassi]]
	+	:[[Best Practices from e- Insurance to e-Takaful by Sami Guello]]
	+	:[[Calculated Risks, Measurable Results]]
	+	:[[Challenges & Issues Faced by Takaful Industry by Mr. Imtiaz ]]
	+	:[[Co-Operative Insurance and Takaful]]
	+	:[[Current Achievements of Takaful by Dr. S. J Malaikah]]
	+	:[[International Cooperative & Mutual Insurance Federation]]
	+	:[[Islamic Banking And Finance Malaysia’s Experience And Achiev]]
	+	:[[Islamic Finance & Investment Symposium by Sohail Jaffar]]
	+	:[[Islamic Insurance in 21st Century by Ahmad Feizal]]
	+	:[[Islamic Insurance Opertunities and Challenges]]
	+	:[[Issues and Challenges in Retakaful by Azman Ismail]]
	+	:[[Leveraging BancaTakaful as a Key Growth Channel by Mr. Rohai]]
	+	:[[Life Family Takaful by Mr. P Ahmed]]
	+	:[[Micro Insurance Co-Operative and Takaful]]
	+	:[[Micro Takaful by Shabir Patal]]
	+	:[[Microinsurance and Takaful]]
	+	:[[Microinsurance, cooperatives and Takaful]]
	+	:[[MicroTakaful – the way forward by Capt. M. Jamil Akhtar]]
	+	:[[Opertunities in Islamic Insurance]]
	+	:[[Present Scenario and Future Potentials of Takaful by Kazi Md]]
	+	:[[ReTakaful by Rohail Ali Khan]]
	+	:[[Syariah Compliant General Takaful Products by Sami Guellouz]]
	+	:[[Takaful and Mutuality by Mohd. Masua Billah]]
	+	:[[Takaful by Abdul Rahim]]
	+	:[[Takaful for Microfinance]]
	+	:[[Takaful Opperunities and Challenges By Azeem Pirani]]
	+	:[[Takaful Products Family Takaful Linked Investment Plans by S]]
	+	:[[Takaful World Prospective Middle East & North Africa]]
	+	:[[Takaful]]
	+	:[[Takful - Zubair Mughal]]
	+	:[[Takful Report]]
	+	:[[The Islamic Vision Presentation]]
	+	:[[The Success of Retakaful by Farid Benbouzid]]
	+
	+
	+
	+	== DOCUMENT REFERENCES ==
	+
	+
	+	=== Number of Pages ===
	+	25
	+
	+
	+	=== Published Date ===
	+	2016-09-17 01:18:27
	+
	+
	+	== Full Document ==
	+
	+
	+	[http://45.40.136.134/~hodhood/HodHoodDocuments/IslamicFinance/Takaful/Microinsurance%20and%20Takaful.pdf Read the Full Document]
	+
	+
	+	[[Category:Islamic Finance]]
	+
	+	[[Category: Takaful]]