HISTORY AND DEVELOPMENT

OF INSURANCES
dibf 06202
Presented By
Mr. Thabiti Mohamedi Ally
Faculty Of Business Administration
Muslim University Of Morogoro
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Are You
Okey ??

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In this very short Tutorial, we will be discussing some

issues relating to the:
Module’s  Historical development of conventional insurance
outline and takaful and

 Trends of takaful practices

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o Insurance has existed for many centuries. Some historian

traced the of insurance to 215 CE, when the Roman
government was required by military supplies to accept
What Is The all risks arising from enemy attacks, storms, and other
Origin of natural disaster for supplies carried on their ships.
Insurance ? o Around 2800 B.C history had shown the insurance
practices from Babylonians to fight against losses by the
merchants and traders.

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o The modern insurance can be traced its beginning to the

1600’s when British merchants and ship owners began to
meet at a coffeehouse near Lombard street in London.

o There they made an agreement to mutually share in the

Cont.…. profit and losses of see voyages.

o In Greeks, Chinese and Europeans as well as England in

1583 the first life insurance contracts was prevailed.

o The movement went viral to Malaysia from 1960’s and in

1963 the government introduced insurance act of 1963.

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The evolution of takaful has a long history. The

main identifiable phases are the following:
1. 1979: The first Ta'awun model (cooperative) was

Historical developed in Sudan.

Development of 2. 1984: The mudharabah model was developed in

takaful Malaysia.

3. 1984: The wakalah model was developed in the Gulf.

4. 1996: The waqf model was developed in South Africa.

Most takaful models are the hybrid of the above models.

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Trends Of
Takaful
Practices

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A. PRACTICE OF AL-AQILAH

 This was a practice of the ancient Arab tribal custom,

Trends Of which was introduced to replace the barbaric “blood for

blood” system. Under this system, if any member of a tribe
Takaful was killed by a member of another tribe, the close relatives
Practices of the killer known as ‘Aqilah’ or ‘Ma’aqil’ in Arabic
terminology are required to pay an amount of “blood
money” as compensation to the heir of the victim.

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A. PRACTICE OF AL-AQILAH

Trends Of  They will collect and contribute on behalf of the killer.

Takaful  The payment of the “blood money” seemed to be a kind

Practices of financial protection for the heir of the deceased

against the unexpected death of the victim.

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B. PRACTICE OF PROPHET MUHAMMAD (s.a.w )

 The practice was endorsed by Prophet Muhammad SAW

Trends Of and was expressed in the first Constitution of Madinah
Takaful (Mithaq al-Madinah). The constitution of Madinah that

Practices was declared shortly after the migration to Madinah in

622 A.D is the greatest example of how the Prophet
Muhammad SAW had legislated the insurance concept.

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C. PRACTICE OF THE COMPANIONS.

 The Aqilah system was further developed during the time

Trends Of of the second Caliph of Islam, Sayydina Umar al-

Khattab (r.a.) He established a Diwan of Mujahidin in
Takaful various districts for the purpose of extending mutual
Practices cooperation to contribute the diyat money for the murder
of their own tribesman committed by another of the same
tribe.

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THE END Wabillah Tawfiiq

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BY MR.THABITI