Opertunities in Islamic Insurance - Revision history

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Opportunities in Islamic

Insurance

Insurance Institute of London

November 14th 2006

Overview of presentation

• About ICMIF

• What is Islamic Insurance (Takaful)?

• Growth and outlook

• Takaful in Non-Muslim countries

• Potential in the United Kingdom

About ICMIF

• Established in 1922

• 174 members from 69 countries

• Member driven services

• 17 Takaful members since 2002

Why is conventional insurance

not permissible?

• Uncertainty (Gharar)

• Gambling (Maisir)

• Interest (Riba)

Earlier forms of Islamic insurance

• Dawania – Mutual indemnification amongst officers during

the rule of Umar Ibn Al Khattab (2nd Caliph)

• Diyyah and Aquilah – Blood money and concept of

removing hardship from victims family by payment of

Diyyah, on a mutual basis, by relatives of offender

• Marine Insurance – Early second century – mutual fund to

cover robberies and mishaps

Fiqh Academy Resolution 1985

• Commerical insurance is prohibited

• Alternative contract confirming to principles of Islamic

dealings is the contract of cooperative insurance, which is

founded on the basis of charitable donation and Shariah

compliant dealings

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”

Takaful models in practice

• Not for profit model

• Ta’awuni model – “cooperative insurance”

• Al Mudharabah model – profit sharing

• Al Wakala model – agency agreement

Growth of the sector

• 1979 First Takaful Company established

• 1996 – 30 Institutions transacting Takaful

• 2002 – 50 Takaful operators and four Retakaful providers

• 2006 – 80 Takaful operators, 120 Takaful windows,12

Retakaful providers and premiums of $3billion

Future growth factors

• High potential for growth of insurance sector

• Retakaful capacity being established

• Increase in Shariah compliant investment products

• Harmonization of models and regulation

• Increase in technical expertise and consumer awareness.

Future Outlook

• Ajmal Bhatty (2001) – USD$ 7.14 bn by 2015

• Dr Malaikah (2006) – Double digit growth over

next ten years

• Atlas Business Magazine (2006) – USD$ 12-14bn

by 2015

Islamic Insurance in Non-

Muslim countries

Takaful in Non-Muslim Countries

Is there a need?

Country Est. Muslim Country Est. Muslim

population population

Argentina 800,000 Italy 600,000

Brazil 1 million Japan 1.3 million

Canada 500,000 USA 10 million

France 4.8 million Netherlands 500,000

Germany 3 million UK 2 million

Takaful in Non-Muslim countries

Is there a need?

• Fasting growing immigrant population

• Belief in will of God

• Acceptance that insurance is not allowed

• First and second generations are

purchasing insurance

• Increased availability of information

• Growth of Islamic banking sector

Potential for Takaful in the UK

• Established Islamic financial services providers

• Potential consumers are first and second generation

• Greater disposable income

• Growing awareness and demand for Takaful

• Regulatory openness

• Ethical positioning

• HSBC Property Takaful already launched

• British Islamic Insurance Holdings

• Lloyds syndicate

Challenges in the UK

• Dispersed population

• Capital requirements

• Investment restrictions

• First to market

• Credibility

• Technical expertise

• Competitive pricing and service

Possibilities for Takaful in the UK

• Affinity marketing of statutory products by cooperative and

mutual insurers.

• Takaful window by existing conventional insurers

Affinity Marketing by Cooperative and

Mutual Insurers

“… It is well known that in most non-Islamic countries there

are cooperative and mutual insurance companies. There is

no harm from the Shari`ah point of view to participate in

these services. So, it is unlawful for a Muslim living in a

country where there is such a cooperative insurance

company to make an agreement with a commercial

insurance company…..”

Ruling by the European Council of Fatwa and Research

Ruling by the European Council of Fatwa

and Research

Muslims are directed to purchase their statutory

insurance requirements from the cooperative and

mutual insurer if there is no Takaful company in the

country

The case of Folksam - Sweden

• 350,000 Muslim population

• Fastest growing immigrant community

• Collaboration with Swedish Muslim Council

• Marketing of Folksam products through

representatives of Council in communities and

mosques

• Insurance committee has been established

Takaful Window

• Separate division

• Shariah board

• Islamic compliant investments

• Surplus distribution

• Policy wording

Conclusion

There is a growing awareness and demand for Islamic

financial instruments including insurance in non-Muslim

countries. There is a great potential for established

financial institutes to set up Takaful windows. In particular

the Shari’ah ruling by the European council presents an

opportunity for cooperative and mutual insurers to be the

first to penetrate this niche market with minimal costs.

Thank you

www.icmif.org/takaful

← Older revision		Revision as of 05:10, 10 November 2017
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−	[~~http~~://45.40.~~136.134~~/~~~hodhood~~/HodHoodDocuments/IslamicFinance/Takaful/Operational%20Mechanism%20of%20Takaful%20by%20Mr.%20M.%20Vaqaruddin.pdf Read the Full Document]	+	[https://www.hodhood.com/en/HodHoodDocuments/IslamicFinance/Takaful/Operational%20Mechanism%20of%20Takaful%20by%20Mr.%20M.%20Vaqaruddin.pdf Read the Full Document]

← Older revision	Revision as of 02:28, 21 September 2016
Line 1:	Line 1:

	+
	+
	+	== Top 20 FREQUENT WORDS ==
	+	takaful 32
	+	fund 19
	+	waqf 17
	+	participant 11
	+	operational 10
	+	profit 8
	+	surplus 8
	+	investment 7
	+	model 7
	+	wakala 7
	+	based 6
	+	expenses 6
	+	profits 6
	+	shareholders 6
	+	operator 5
	+	business 4
	+	policyholders 4
	+	attributable 3
	+	funds 3
	+	management 3
	+	mudharabah 3
	+	paid 3
	+	waqif 3
	+
	+
	+
	+	== DOCUMENT KEY POINTS ==
	+	*presented by m vaqaruddin ceo pak qatar general takaful ltd
	+	*karachi
	+
	+	*mudharabah based takaful a c in this model a clear distinction is made between the business of takaful or insurance and the business of investing funds mobilized from policyholders and or the shareholders
	+
	+	*wakala based takaful a c in the wakala based model the takaful operator acts as the wakil or agent of the policyholders
	+	*it incurs all the operational expenses on behalf of its principal
	+
	+	*a c the waqif can put conditions at the time of waqf
	+	*a c waqf charity religious endowment testamentary bequest of real estate
	+
	+	*wakala waqf based takaful a c some of the shariah scholars have critically analyzed the wakala system and have suggested to incorporate the concept of waqf into the wakala model
	+
	+
	+	''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 ===
	+	9
	+
	+
	+	=== Published Date ===
	+	2016-09-17 01:18:35
	+
	+
	+	== Full Document ==
	+
	+
	+	[http://45.40.136.134/~hodhood/HodHoodDocuments/IslamicFinance/Takaful/Operational%20Mechanism%20of%20Takaful%20by%20Mr.%20M.%20Vaqaruddin.pdf Read the Full Document]
	+
	+
	+	[[Category:Islamic Finance]]
	+
	+	[[Category: Takaful]]

← Older revision		Revision as of 00:41, 21 September 2016
Line 1:		Line 1:
−	~~Opportunities in Islamic~~
−	~~Insurance~~
−	~~Insurance Institute of London~~
−	~~November 14th 2006~~

−	~~Overview of presentation~~
−	~~• About ICMIF~~
−	~~• What is Islamic Insurance (Takaful)?~~
−	~~• Growth and outlook~~
−	~~• Takaful in Non-Muslim countries~~
−	~~• Potential in the United Kingdom~~
−
−	~~About ICMIF~~
−	~~• Established in 1922~~
−	~~• 174 members from 69 countries~~
−	~~• Member driven services~~
−	~~• 17 Takaful members since 2002~~
−
−	~~Why is conventional insurance~~
−	~~not permissible?~~
−	~~• Uncertainty (Gharar)~~
−	~~• Gambling (Maisir)~~
−	~~• Interest (Riba)~~
−
−	~~Earlier forms of Islamic insurance~~
−	~~• Dawania – Mutual indemnification amongst officers during~~
−	~~the rule of Umar Ibn Al Khattab (2nd Caliph)~~
−	~~• Diyyah and Aquilah – Blood money and concept of~~
−	~~removing hardship from victims family by payment of~~
−	~~Diyyah, on a mutual basis, by relatives of offender~~
−	~~• Marine Insurance – Early second century – mutual fund to~~
−	~~cover robberies and mishaps~~
−
−	~~Fiqh Academy Resolution 1985~~
−	~~• Commerical insurance is prohibited~~
−	~~• Alternative contract confirming to principles of Islamic~~
−	~~dealings is the contract of cooperative insurance, which is~~
−	~~founded on the basis of charitable donation and Shariah~~
−	~~compliant dealings~~
−
−	~~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”~~
−
−	~~Takaful models in practice~~
−	~~• Not for profit model~~
−	~~• Ta’awuni model – “cooperative insurance”~~
−	~~• Al Mudharabah model – profit sharing~~
−	~~• Al Wakala model – agency agreement~~
−
−	~~Growth of the sector~~
−	~~• 1979 First Takaful Company established~~
−	~~• 1996 – 30 Institutions transacting Takaful~~
−	~~• 2002 – 50 Takaful operators and four Retakaful providers~~
−	~~• 2006 – 80 Takaful operators, 120 Takaful windows,12~~
−	~~Retakaful providers and premiums of $3billion~~
−
−	~~Future growth factors~~
−	~~• High potential for growth of insurance sector~~
−	~~• Retakaful capacity being established~~
−	~~• Increase in Shariah compliant investment products~~
−	~~• Harmonization of models and regulation~~
−	~~• Increase in technical expertise and consumer awareness.~~
−
−	~~Future Outlook~~
−	~~• Ajmal Bhatty (2001) – USD$ 7.14 bn by 2015~~
−	~~• Dr Malaikah (2006) – Double digit growth over~~
−	~~next ten years~~
−	~~• Atlas Business Magazine (2006) – USD$ 12-14bn~~
−	~~by 2015~~
−
−	~~Islamic Insurance in Non-~~
−	~~Muslim countries~~
−
−	~~Takaful in Non-Muslim Countries~~
−	~~Is there a need?~~
−	~~Country Est. Muslim Country Est. Muslim~~
−	~~population population~~
−	~~Argentina 800,000 Italy 600,000~~
−	~~Brazil 1 million Japan 1.3 million~~
−	~~Canada 500,000 USA 10 million~~
−	~~France 4.8 million Netherlands 500,000~~
−	~~Germany 3 million UK 2 million~~
−
−	~~Takaful in Non-Muslim countries~~
−	~~Is there a need?~~
−	~~• Fasting growing immigrant population~~
−	~~• Belief in will of God~~
−	~~• Acceptance that insurance is not allowed~~
−	~~• First and second generations are~~
−	~~purchasing insurance~~
−	~~• Increased availability of information~~
−	~~• Growth of Islamic banking sector~~
−
−	~~Potential for Takaful in the UK~~
−	~~• Established Islamic financial services providers~~
−	~~• Potential consumers are first and second generation~~
−	~~• Greater disposable income~~
−	~~• Growing awareness and demand for Takaful~~
−	~~• Regulatory openness~~
−	~~• Ethical positioning~~
−	~~• HSBC Property Takaful already launched~~
−	~~• British Islamic Insurance Holdings~~
−	~~• Lloyds syndicate~~
−
−	~~Challenges in the UK~~
−	~~• Dispersed population~~
−	~~• Capital requirements~~
−	~~• Investment restrictions~~
−	~~• First to market~~
−	~~• Credibility~~
−	~~• Technical expertise~~
−	~~• Competitive pricing and service~~
−
−	~~Possibilities for Takaful in the UK~~
−	~~• Affinity marketing of statutory products by cooperative and~~
−	~~mutual insurers.~~
−	~~• Takaful window by existing conventional insurers~~
−
−	~~Affinity Marketing by Cooperative and~~
−	~~Mutual Insurers~~
−	~~“… It is well known that in most non-Islamic countries there~~
−	~~are cooperative and mutual insurance companies. There is~~
−	~~no harm from the Shari`ah point of view to participate in~~
−	~~these services. So, it is unlawful for a Muslim living in a~~
−	~~country where there is such a cooperative insurance~~
−	~~company to make an agreement with a commercial~~
−	~~insurance company…..”~~
−	~~Ruling by the European Council of Fatwa and Research~~
−
−	~~Ruling by the European Council of Fatwa~~
−	~~and Research~~
−	~~Muslims are directed to purchase their statutory~~
−	~~insurance requirements from the cooperative and~~
−	~~mutual insurer if there is no Takaful company in the~~
−	~~country~~
−
−	~~The case of Folksam - Sweden~~
−	~~• 350,000 Muslim population~~
−	~~• Fastest growing immigrant community~~
−	~~• Collaboration with Swedish Muslim Council~~
−	~~• Marketing of Folksam products through~~
−	~~representatives of Council in communities and~~
−	~~mosques~~
−	~~• Insurance committee has been established~~
−
−	~~Takaful Window~~
−	~~• Separate division~~
−	~~• Shariah board~~
−	~~• Islamic compliant investments~~
−	~~• Surplus distribution~~
−	~~• Policy wording~~
−
−	~~Conclusion~~
−	~~There is a growing awareness and demand for Islamic~~
−	~~financial instruments including insurance in non-Muslim~~
−	~~countries. There is a great potential for established~~
−	~~financial institutes to set up Takaful windows. In particular~~
−	~~the Shari’ah ruling by the European council presents an~~
−	~~opportunity for cooperative and mutual insurers to be the~~
−	~~first to penetrate this niche market with minimal costs.~~
−
−
−	~~Thank you~~
−	~~www.icmif.org/takaful~~