Professional Documents
Culture Documents
An Introduction Takaful
An Introduction Takaful
Introduction of Participants
Name
Department
Designation
Qualification
Experience
Takaful Course (if attended before)
Some Misconceptions
1. Risk Avoidance
2. Risk Control
3. Risk Retention
4. Risk Transfer
5. Risk Sharing
Risk Management in Quran & Hadith
َّ ُ ْ ْ ُ ْ َ َ ْ َ ْ ُ َ َ ُّ َ
• وا ِعدوا لهم مأ استطعتم ِمن قو ٍۃ ۔۔۔ [اَلفناأ]٦۰ ،،
َ َ َ َ َ ْ َ ْ َ َ ْ َ ُ ْ َ ً َ َ ًّ ُ ْ َ ُ َّ ْ ُ َ ى َ َ ْ َ ْ َ َ َ ُ ْ َ َ ْ َ ْ َ ْ َ
• وكذ ِلك اوحينأ ِاليك قرافنأ ع ِربيأ ِلتن ِذر ام القر ومن حولهأ وتن ِذر يوم الجم ِع َل
َ ْ َ
َرْي َب ِف ِيه ف ِريق ِفي الجن ِة وف ِريق ِفي الس ِعير[...شو ]۷-
ری َّ ٌ َ َّ َ ٌ
ْ ْ
اّلل! َا ْع ِق ُل َهأ َو َا َت َو َّك ُل َا ْو ُاط ِل ُق َهأ َو َا َت َو َّك ُل؟ َق َأْ :،اع ِقل َهأ َو َت َو َّك ْل[.السسن للترمذی]
• َق َأَ ،ر ُج ٌلَ :يأ َر ُس َوَِّ ،
TAKAFUL
CONVENTIONAL INSURANCE
• It is generally agreed that the history of insurance began with marine insurance in
the fourteenth century. It was invented as a solution to the problem of sea piracy
and from the possibility of ship sinking in high waters. Both carried immense
financial risk. Insurance served to counter that financial risk.
• Many believe that conventional insurance first got introduced in Islamic Fiqh in the
twentieth century, but this is not so. Research tells us that the first fatwa issued on
the subject was by a renowned Jurist from Syria by the name of Allama Ibn
Abideen Shami (may Allah be pleased with him) in his famous book titled “Radul
Mukhtar” (which is also known as Fatawa Shamia. This fatwa is regarded as an
authentic fatwa).
• In fact, we find that insurance was very much a norm in the days of Allama Shami
(may Allah be pleased with him). Traders were accustomed to paying additional
amount over routine costs for the transportation of their goods overseas. This
additional amount was called “Sokara”. Sokara means insurance and security. The
insurers promised to compensate for any loss to their cargo while at sea against
these premiums. This was marine insurance in action. Allama Shami issued a
fatwa against the practice of this form of insurance with the word of “Sokrah”.
What is Insurance ?
concept of
Insurance?
? practice of
Insurance?
Premiums
عقد معاوضہ عقود المعأوضأت :وهي مأ كأن التمليك فيهأ (عين المأ ،،او مناعته) •
بمقأبل سواء كأن المقأبل مأَل او فنحوه.
• Example: Selling Purchasing, Leasing
Commutative (Ijarah), Nikhah, Rahan etc.
Contract
عقد تبرع • عقود التبرعأت :وهي مأكأن التمليك فيهأ من غير مقأبل مثل الهبة
والصدقة ،والوصية والوقف واَلعأرۃ.
Taburru • Example: Hibah (Gift), Sadqah, Loan,
Ariah, Wasiyyah, Waqf etc.
Contract
Shariah’s perspective/stance on Insurers’ Business
Model
• Insurer: The insurance company is selling “Sum Insured”
• Insured: The policyholder is buying Sum Insured by paying fixed
“Premiums”
• Nature of Contract:
• It is a sales purchase contract, bi-lateral, commutative i.e. Aqd-e-Muawaza
Shariah’s perspective/stance on Insurers’ Business Model
– Subject Matter: “Sum Insured” ; Consideration: “Premium”
• It is a Risk-Transfer Mechanism
– The insured (financially weaker party) is transferring its risk to the
insurer (financially stronger party)
– The insurer is charging a fee called “Premium” for accepting the
risk and promising to pay “Sum Insured” if a covered event takes
place
Riba, Qimar, Gharar
• )الربأ هو الاضل المستحق َلحد المتعأقدين في المعأوضة الخألي عن عوض شرط فيه(الهداية
• A conditional increase in commutative contract without consideration.
الرَبأ َو َق ْد ُفن ُهوا َع ْن ُه َو َا ْك ِل ِه ْم َا ْم َو َا، م أت ُا ِح َّل ْت َل ُه ْم َوب َص ِد ِه ْم َع ْن َسبيل َّ
اّلل َك ِث ًيرا (َ )160و َا ْخ ِذ ِه ُ َ
ب ي { َفب ُظ ْلم م َن َّالذ َين َه ُأدوا َح َّر ْم َنأ َع َل ْيه ْم َ
ط •
ِ ِ ِ ِ ِ ٍ ِ ِ ِ ٍ ِْ ِ
َ َ ْ َ ْ َ ْ َ َ َّ
أس ِبأل َب ِأط ِل َوا ْعتدفنأ ِللك ِأف ِر َين ِمن ُه ْم َعذ ًابأ ا ِل ًيمأ } [النسأء]161 ،160 : الن ِ
ون} [ا ،عمران]130 : { َيأ َا ُّي َهأ َّال ِذ َين ا َم ُنوا ََل َت ْأ ُك ُلوا الرَبأ َا ْض َع ًأفأ ُم َض َأع َا ًة َو َّات ُقوا َّ َ
اّلل َل َع َّل ُك ْم ُت ْا ِل ُح َ •
ِ
َّ َ َ ْ ُ ُ َ َ َ َ ُ ُ َ َّ َ َ َ ُ ُ َّ َ َ َ َّ ُ ُ َّ ْ َ ُ َ ْ َ َ َ َ َّ ُ ْ َ ُ َّ َ ْ َ ْ ُ ْ ُ َ َ َ َ َّ َّ ُ ْ
اّلل ال َب ْي َع َو َح َّر َم الربأ واحل س َذ ِلك َ ِبأفنه َم قألوا افنمأ البيع ِمثل ِ الربأ ََل ٌيقومون ِا ََل ْكمأ يقَ َوم ال ِذ َي يتخ َبطه َالشي َّطأن ِمن ال َم َ ِ {ال ِذ َين يأكلَون ِ •
اّلل الربأَ ون (َ )275ي ْم َح ُق َُّ أب َّالن ِأر ُه ْم ِف َيهأ َخأ ِل ُد َ ْ َ ُ
اّلل َومن َعأد فأول ِئك اصح ُ ْ َ ُ َ َ ُ َ
الرَبأ ف َم ْن ج َأء ُه َمو ِعظة ِمن َ ِرب ِه فأفنت َهى فله مأ َسلف َوام ُره ِالى ِ
ْ ْ ْ
َِ َ ْ ُ ْ َ َّ َ َ َ َ ُ َّ َ َ َ ِ َ َ َ ُ ُ َّ َّ َ َّ َ َّ ُ َّ َ َ َ َّ ُ َ ِ
َ ْ َ ْ ُ
أت واقأموا الصالۃ واتوا الزكأۃ لهم اجرهم ِعند ِرب ِهم وَلْ ُ ُ َ ِ َّ َ َ َ َ
أت واّلل َل ي ِحب كل ك ا ٍأر ا ِث ٍيم (ِ )276ان ال ِذين امنوا وع ِملوا الصأ ِلح ُّ ُ ِ َو ُي ِربي الصدق ْ
َ
ين (َ )278ف ِأ ْن ل ْم َت ْا َع ُلوا َف ْأ َذ ُفنوا اّلل َو َذ ُروا َمأ َب ِق َي ِم َن الرَبأ ا ْن ُك ْن ُت ْم ُم ْؤ ِم ِن َ ون (َ )277يأ َا ُّي َهأ َّال ِذ َين ا َم ُنوا َّات ُقوا َّ َ َخ ْو ٌف َع َل ْيه ْم َو ََل ُه ْم َي ْح َزُفن َ
ُ َّ َ َ ْ َ َ َ َ ْ َ َ ِْ َ َ ُ ُ ْ َ َ َ َ ٌ َ ِ
َ ُ َ َ ْ َ ِ َّ َ َر ُ َ ْ ُ ْ ُ ْ َ َ ُ ْ ُ ُ ُ َ ْ َ ُ ْ َ َ ْ ُ َ َ َ ُ ْ
اّلل و سو ِل ِه و ِان تبتم فلكم رءوس اموا ِلكم َل تظ ِلمون وَل تظلمون ( )279و ِان كأن ذو عسر ٍۃ فن ِظرۃ ِالى ميسر ٍۃ وان تصدقوا ِبحر ٍب ِمن ِ
ون} [البقرۃ]280 - 275 : َخ ْي ٌر َل ُك ْم ا ْن ُك ْن ُت ْم َت ْعل ُم َ
َ
َ ُ َ َ ْ َ ْ َ ْ ِ َ ُ َ ْ َ ُ َ ْ َ َّ َ َر ُ َ ْ ُ ْ ُ ْ َ َ ُ ْ ُ ُ ُ َ ْ َ ُ ْ َ َ ْ ُ َ َ َ ُ ْ
اّلل و سو ِل ِه و ِان تبتم فلكم رءوس اموا ِلكم َل تظ ِلمون وَل تظلمون ()279 ف ِأن لم تاعلوا فأذفنوا ِبحر ٍب ِمن ِ •
Riba in Hadith
َيأ َا ُّي َهأ َّال ِذ َين ا َم ُنوا ا َّفن َمأ ْال َخ ْم ُر َو ْال َم ْي ِس ُر َو ْ َاَل ْفن َصأ ُب َو ْ َاَل ْ َزَل ُم ر ْج ٌس ِم ْن َع َمل َّ
الش ْي َطأن َفأ ْج َت ِن ُبوهُ
ِ ِ ِ ِ
ون [المأئدۃ]90 : َل َع َّل ُك ْم ُت ْا ِل ُح َ
اے ایمان والو! شراب ،جوا ،بتوں کے تھان اور جوے کے تیر ،یہ سب ناپاک شیطانی کام ہیں
،لہذا ان سے بچو ،تا کہ تمہیں فالح حاصل ہو۔
Qimar/Maysir in Conventional Insurance
ْ
هللا َع َل ْي ِه َو َس َّل َم َع ْن َب ْي ِع ال َح َص ِأۃَ ،و َع ْن َب ْي ِع
هللا َص َّلى ُ
ِ
• َع ْن َابي ُه َرْي َر َۃَ ،ق َأَ « :،فن َهى َر ُس ُ
و، َْ ِ
الغ َر ِر»(صحيح مسلم)
Gharar in
Conventional
• This is due to the nature of the contract
Insurance contract is
i.e. Aqd-e-Muawaza
that of the Excessive
Nature
The conventional
insurance contract • whether or not the insured will get the
gives rise to Gharar as compensation which has been promised
the Subject Matter is • how much the insured can get ;
not clear with regards • when the compensation can be paid
to:
Fatwas Against Conventional Insurance
• The majority of scholars is of the opinion that the conventional insurance practiced
today is not Shariah compliant
• A fatwa issued by a committee comprising of leading scholars for the Saudi Arabia
Government
– “Our observation that the modern form of insurance companies and their
current practices are objectionable Islamically does not mean that Islam is
against the concept of Insurance itself ; not in the least – it only opposes the
means and methods. If other insurance practices are employed which do not
conflict with Islamic forms of business transaction ; Islam would welcome
them” “The Lawful & the Prohibited in Islam” (pg. 276)
• The National Fatwa Committee Malaysia deliberated on the question of life
insurance (15th. June 1972) and below is a translation of an extract from the
minutes recorded
– “Life insurance as presently practiced by insurance companies is a fasid
transaction as it is contrary to the Shariah principles of contract because it
contains the following elements : Riba, Gharar, Maisir. As such from the
Shariah point of view, insurance is haram”.
Definition of Takaful
EXAMPLES: The concept of Takaful exists in cooperative societies and joint-family systems etc
In practice, Takaful can serve as a risk-mitigation tool and an alternative to conventional insurance.
Three Operational Models
Hybrid –
Wakalah + This is the most prevalent model.
Mudarbah
Hybrid –
Wakalah+ This model was suggested by
Mudarbah+ Shariah Scholars in Pakistan.
Waqf
Definition of Waqf
Participant
Surplus
Wakalah Fee, Claims, Re-Takaful
Participant
Waqf Pool
Takaful Wakalah
Wakalah
Wakalah
Wakalah
Wakalah Wakalah Risk sharing
Operator
Between
Participants
(MUDHARABAH)
Participant
Investment Participant
How does it Function? Family Takaful
Participant 1
Contributions
Participant’s
Investment 4
Profits from Investment
Account (PIA) Wakalee Fee(s) for
Investment
5 Management
Contributions for
Takaful Benefit
3 2
Payment of Claims
6
Surplus Distribution Waqf Fund Wakala Fee for Operator / Wakeel
Operating Waqf
7 (if any)
Fund
Key Points on Takaful Process
Shariah and
Shariah Transparent Surplus
Socially
Compliant Ethical and Full
Disclosure
Responsible Sharing
Investments
Participant Takaful Fund (PTF) - Income
• Salvage/Recoveries
• Contribution of Re-Takaful
• To create various sub funds under the main Waqf Fund is permissible
• The loan shall be repaid from the future surpluses generated in the PTF
without any excess on the actual amount given to the PTF.
• The actual distribution of surplus may be made only to those
Participants leaving the pool during the year by way of withdrawal,
death or maturity of the membership.
• No surplus shall be distributed if any claim(s) has been lodged by the
participant during the period of Takaful coverage and the Operator has
entertained that claim.
• The Takaful Operator may distribute surplus either in cash or adjust
against future Contributions
• At least 1% of Surplus would be made for the charitable purpose
Charity Guidelines
• http://www.pakqatar.com.pk
Jazaak Allah
Khairan
Questions?