37
Themes Conventional Insurance Takaful
fund profits and underwriting
surplus, belong to the
insurance company
surplus belong to the participants
collectively
Receivable upon
maturity
The amount agreed upon in
the contract (dividends,
bonus, and interest)
Participant’s share from the
investment account and profit (if
any) from investment and the
maturity value of the participant’s
risk fund
Receivable upon
surrender
The amount agreed upon in
the contract (interest,
dividend and bonus (if any)
Participant’s share from the
investment account and profit (if
any) and the surrender value of the
participant’s risk fund
Liability to pay
claims
The company is liable to pay
the claims from its assets
(the insurance funds and the
shareholders’ fund) even
though the claims exceed the
amount of the paid premium.
All claims are paid from the Takaful
fund. If the number of claims
exceeds the amount collected in the
fund, the participants should
increase their contributions
Investment of the
insurance/Takaful
fund
The premiums might be
invested in interest-bearing
securities
The funds must be invested in
Shari'ah-compliant instruments and
halal businesses
Sources of ruling Purely based on “man-made”
laws such as Acts, Case laws
and age-long trade practices
Qur’an, Sunnah, and Fiqh rulings
based on revelations
Agency commission Paid from the premium Depending on the Takaful model
adopted
Source: Rusni Hassan, 2011