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distinctive features that could be used to reconcile the global financial system with Islamic law
– the Shari'ah.
The fast rates of growth of the Islamic finance industry have been accompanied by geographical
spread into not only Muslim-majority countries but also non-Muslim economies. With the
worldwide spread of Islamic finance, there has been a significant growth in thought leadership
through related books, monographs, reports and academic articles on Islamic finance. Since the
emergence of the modern Islamic finance industry in the 1960s, there has been a continued and
accelerated development of Islamic finance, which has been gathering momentum with specific
regional and global developments during the past five decades. Nevertheless, Takaful has not
achieved a similar achievement in its own unique segment, as it continues to struggle to expand
its frontiers within the Muslim world and to gain a considerable market share in a world
dominated by conventional insurance. This makes a case for the need to improve the Takaful
sector in Muslim jurisdictions across the world – an objective this study that seeks to achieve in
a comprehensive manner.
1.2. Objective of the Study
The main objectives of this study is to (i) provide an analysis of the theoretical and legal nature
of Takaful, including the interpretation of various schools of thought (madhahib) on the
comparison of conventional and Islamic insurance; (ii) give detailed analysis on the current size
and trends, structures, modes, and instruments of Takaful; (iii) explain the operational aspects
of Takaful business, including a comprehensive and detailed analysis on types of Takaful
structures, structural, regulatory and technical challenges facing Takaful sector; (iv) do country
analysis on the selected countries on Takaful market.
Based on the above-mentioned objectives, the study will provide policy recommendations to the
OIC Member countries on Takaful structures and related issues, by taking into consideration the
OIC and non-OIC members case studies.