Family Takaful by Azeem Pirani

Family Takaful

       Azeem Pirani

 Regional Manager – Pakistan

          FWU AG

                3rd International Conf. & Exhibition

                                Islamabad – Nov. 2009

             Contents

•What is Family Takaful

•Life Insurance in Pakistan

•Family Takaful Products

•How does Family Takaful Function?

•Need of Family Takaful

•Powerful Proposition

•Conclusion

      What is Family Takaful?

• It is an Islamic alternative to conventional life

 insurance

• The concept is based on the principles of Risk

 Sharing (as opposed to Risk Transfer)

• Life cannot be insured but the beneficiaries can

 be financially supported by a system of mutual

 assistance

      Life Insurance in Pakistan

                                                                               4.50%

       3.95%

                                                                               4.00%

                                                                               3.50%

                                                2.95%

                                                                               3.00%

                                                                               2.50%

                                                                               2.00%

                                                                               1.50%

                            0.89%                                              1.00%

                                                                  0.36%        0.50%

                                                                               0.00%

Malaysia - GDP $4762 Indonesia - GDP $1186 India - GDP $621 Pakistan - GDP $519

      Family Takaful Products?

For Corporate Customers

• Group Healthcare for employees

• Retirement Income Plans

• Salary Continuation in case of employees death

 or disability

For Individual Customers

• Savings & Protection Plans

• Education Plan

• Retirement Income Plan

• Mortgage Takaful

How does Family Takaful function?

• Participants pool their savings into two

 separate accounts with the FT Operator

  – Into Waqf Pool:

      • As taburru: to eliminate Riba and make Gharrar & Qimar

        ineffective

      • Nobody owns the Waqf Pool;The FT Operator acts as its

        Wakeel

      • All claims are paid from the Waqf Pool

  – Into Participants Investment Account:

      • Which is unit-linked

      • Contributions are invested to generate Halal profits for

        members

How does Family Takaful function? (cont)

 Need of Family Takaful

           Against financial loss from:

           -  Death

           -  Disability             Participant

Protection                          Takaful Fund

           -  Medical Illness

                                       (PTF)

           In order to fulfill short-term

              & long-term needs such

Investment as:

           -  Children’s education and

 Growth       marriage

           -  Purchasing a new house

           -  Affording Hajj/Umrah

              Expenses               Participant

           -  Retirement             Investment

              Income, etc           Account (PIA)

        Powerful Proposition?

Win-Win

• The only protection + savings tool

• Offering Halal income

• Financial protection against specific risks

Surplus Sharing

               Conclusion

• Dire need for financial protection in our

 society.

• Shariah compliant nature will allow it to reach

 those consumers who would rather have a

 Halal option.

Jazak-Allah Khair

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