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TABLE 20: ISSUES AND POLICY RECOMMENDATION FOR THE UK
Issues Recommendations
Implementing
Authority
1. National Policy
 Apart from the Takaful
Alternative Student Finance,
the UK has not projected the
Takaful sector as a prime
policy of the government as it
did in the Sukuk sector.
 As an international financial
centre, the UK has not been
exporting its Takaful models
to other jurisdictions as it has
done in the conventional
insurance sector.
 Take relevant step to
promote Takaful as part of
the general policy of
financial inclusion in the
UK.
 To support Takaful
initiatives, including the
efforts of the Islamic
Insurance Association of
London (IIAL) in
projecting London as a
global financial centre.
 Relevant
government
ministry
 Relevant
government
ministry and IIAL
2. Legal and Regulatory Framework
 There are no relevant
provisions on Takaful or
alternative insurance
arrangements in the Financial
Services and Markets Act
2000 and Financial Services
and Markets Act 2000
(Regulated Activities) Order
2001.
 Prudential standards and
Shari'ah governance need to
be tailored to the UK Takaful
needs
 Relevant provisions
should be introduced into
the laws to reflect
alternative insurance
arrangements. Since tax
issues may still evolve in
some Takaful models, and
there is a need to level the
playing field.
 Since the Bank of England
is a member of the Islamic
Financial Services Board,
there is some scope for the
adoption of best practices
in Takaful and Re-Takaful
sector in the UK
 Relevant
government
ministry
 Bank of England,
Financial Conduct
Authority,
Prudential
Regulation
Authority, IFSB
3. Takaful Operators and Product Development
 Since some early experiments
of Takaful in the UK failed,
there has not been many
efforts on product
development.
 The education Takaful model
in a secular environment
known as Takaful Alternative
Student Finance will serve as
a good model for other
Western countries.
 There should be proactive
measures towards
product development to
ensure Takaful products
are not only seen as
Shari'ah-compliant but are
conventionally viable and
competitive.
 Other jurisdictions,
including OIC countries,
may introduce such
education Takaful for
student financing.
 TOs and IIAL
 OIC member
countries
Source: Authors