Revisiting Takaful Insurance: A Survey on Functions and Dominant Models

Yıl 2013, Cilt: 2 Sayı: 1-2, 231 - 253, 01.06.2013

Hashem Abdullah Alnemer

Öz

Takaful is a growing and fast-developing industry, which offers an insurance policy that complies with Islamic law. Such business is highly recommended by most Muslim scholars because it reflects the real meaning of brotherhood in protecting individual and corporate bodies against loss or hazards to themselves and their properties. As a result, a number of operational models have been applied by takaful operators1 by adopting one or more contracts, such as Mudarabah, wakalah or waqf. This paper will therefore highlight important issues that deal with the background of Islamic insurance in terms of definition, functions, as well as exploring takaful contract constructions and various mechanisms linking the contract parties. Finally, this paper will highlight the most dominant and practiced models used by takaful operators worldwide

Anahtar Kelimeler

definitions, Functions, contract mechanisms, models

Kaynakça

• Such as perils or hazard. If the participants are intending to invest some of the money as their savings and donate some portions for mutual indemnity, then the governing contract is mush- arakah, together with tabarru or donation of a portion of the contribution to the takaful fund (Ali and Odierno, 2008).
• Such as “piety purification, brotherhood, charity (tabarru or contribution), mutual guarantee, community well-being as opposed to profit maximization. Islamic General Insurance. Islamic Life Insurance. Within the scope of Family takaful are offered different types of saving and protec- tion products, such as education, mortgage, retirement plans, protection for critical illness or disability, retirement annuities and waqf plans. A family plan may last as long as 10, 15, 20 years or more (Bhatty, 2008).
• General takaful is more concerned with causality types of product in the form of in- dividual retail products such as household fire protection, motor, medical and health cover, personal accident protection during Hajj season, or corporate segment prod- ucts such as marine and aviation to cover transit cargo, engineering, or fire, the con- tract for which normally stands for one year. The operator cannot ask for an additional wakalah fee in the future if the calculated fee was underestimated. CCB Rulebook, 2005.
• Participant’s donation varies in accordance to his age at the time of the contract (Hassan and Lewis, 2007).
• This model is highly recommended by the AAOIFI to be used by the takaful op- erator (AAOIFI, 2003). It has a dominating presence on both Middle Eastern and global markets.
• The word waqf and its plural form awqaf are derived from the Arabic root verb waqafa, which means causing a thing to stop and stand still. The second meaning is simply pious (charitable) foundations (Cizakca, 1998). In Shari’ah, waqf is a volun- tary, permanent, irrevocable dedication of a portion of one’s wealth in cash or any other kind to Allah (Ismail, 2006).
• Takaful international in Bahrain, National Takaful in Malaysia, Islamic Insurance company in Qatar. References AAOIFI, 2003. Accounting, Auditing and Governance Standards for Islamic Financial Insti- tutions. 2003-4. Manama Bahrain.
• Abdul Wahab, A. R., Lewis, M. K. and Hassan, M. Kabir, 2007. Islamic Takaful: Business
• Models, Shari’a Concerns and Proposed Solutions. Thunderbird International Busi- ness Review, 49 (3), pp. 371-397. Al-Darir, S., 2004. Al-etbarat AlShariah le Momarasat Al-tameen (Shari’ah Principles to be considered in conducting insurance business, Khartoum, Sudan. pp. 20 - 35.
• Al-Salih, M.B.A.B.S., 2004. Al-Tamin Bayan Al-Hazr Wa-al-ibahah (Insurance between
• Prohibition and Acceptance). Riyadh: Maktabat Al-Malik Fahad Al-Wataniah. Al-Zarqa, M. A., 1962. Aqd Al-Tamin (Al-Sawkarah) Wa-Mawqif Al-Sharia’h Al-Islam- iyah minh (Insurance Contract and the Position of Sharia’h Law from this Contract).
• Dimashiq, Syria: Matba’at Jami’at Dimshq. AlAHLI Takaful, 2010. Annual Report Board of Directors. AlAHLI Takaful Company.
• AlJazira, 2008. Annual Report. AlJazira Bank.
• AlQaradawi, Y., 2003. The Lawful and Prohibition in Islam. New York: American Trust Publications.
• Asaria. M. I., 2009. Takaful & Mutuality – A Meeting of Minds or a Parting of Ways?. Inter- national Takaful Summit. 30 June 2009. Jumeirah Carlton Tower, London.
• Attar, A. T., 1983. Hukm Al-Tamin Fi Al-Sharia’h Al-Islamyah (Insurance Contract under
• Sharia’h Law), Maktabat Al-Nahdah, Cairo. Egypt.. Ayub, M. 2007. Understanding Islamic Finance. Singapore: John Wiley & Sons Ltd.
• Bhatty, A., 2008. Will Takaful Penetration Match Conventional Insurance. Second Inter- national Takaful Summit. London: Jumeirah Carlton Tower.
• Bhatty, A., 2010. The Growing Importance of Takaful Insurance. Presented at the Asia Re- gional Seminar organized by OECD and Bank Negara Malaysia under Sponsor- ship of the Government of Japan.
• Billah, M. ed., Development and applications of Islamic Insurance (Takaful). Available at:<URL: http//www.icmif.org> [Accessed 30 August 2009].
• Billah, M. ed., Modern Re-Discovery of Takaful (Islamic Insurance): Principles & Practices. Available at:<URL:: http//www.icmif.org> [Accessed 30 May 2009].
• Cizakca, M., 1998. Awqaf in History and Its Implications for Modern Islamic Econo- mies. Islamic Economic Studies, 6 (1), pp 43-73.
• Dacey, M. S., 1989. Principles and Practise of Insurance. London: Witherby & Co.
• Engku Ali, H. O., 2008. Essential Guide for Takaful (Islamic Insurance), Kuala Lumpur:
• CERT Publications Sdh, Bhd. Ernest & Young (E&Y). 2010 and 2011. World Takaful Report. Available: <URL:http:// www.ey.com> [Accessed 1 August 2011].
• Fisher, O. and Taylor, D., 2000. Prospect for Evolution of Takaful in the 21st Century. Avail- able at:<URL:http://www.baj.com.sa> [Accessed 1 May 2009].
• Hasan, Z., 2011. Money Creation and Control from an Islamic Perspective. Review of
• Islamic Economics, 15 (1), pp. 93-111. Hassan, M. K. and Lewis, M. K., 2007. Islamic Banking: An Introduction and Overview.
• In: M. K. Hassan and M. K. Lewis, eds., The Handbook of Islamic Finance. Chel- tham: Edward Elgar. pp. 100 - 150. Ibn Qudamah, A., 1382/1962. Al-Muqni‘. Qatar: Matabi‘ Qatar al-Wataniyyah.
• IFSB., 2009. Guiding Principles on Governance for Takaful (Islamic Insurance) Undertakings.
• Working Paper No. IFSB-8. IFSB, Kuala Lumpur. Ismail, S. G., 2006. Insurance Revisited – The Sharia’h View. New Horizon, 132, pp. 12-19.
• Lewis, M. K., 2003. Challenges to the Takaful Industry. New Horizon, 132, pp. 10-14.
• Nordin, M. T., 2007, Strengths and Opportunities of Takaful: the Spiritual Dimension.
• In: Sohail Jaffer, ed., Islamic Insurance: Trends: Opportunities and the Future of Takaf- ul. London: Euromoney Institutional Investor Plc. pp. 154-159. SAAB, 2009. The Right Issue Prospectus. Riyadh: SABB Takaful Company.
• SAMA, 2005. Law on Supervision of Cooperative Insurance Companies. Riyadh: SABB Takaful Company.
• Smith, A. P., 2007. Takaful Business Model. In: Sohail Jaffer, ed., Islamic Insurance: Trends:
• Opportunities and the Future of Takaful. London: Euromoney Institutional Investor Plc. pp. 87-100. Tolefat, A., 2008. An Analysis of the Investment Portfolio Composition of Takaful Undertak- ings in the GCC and Malaysia. PhD Thesis, Durham University, Durham, United Kingdom.