Diversification of Islamic Financial Insturments
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 Aqd Mudarabah44 : In this contract, the Takaful operator will act as the operator
( Mudarib) that manages the funds and the Takaful participants act as the owner of
funds (Sahibul Mal). The participants authorize Takaful operator to manage the funds
and the profit gained in the investment will be shared with an agreed ratio of profit
sharing.
 Aqd Mudarabah Mushtarakah45: The contract is a combination of Mudarabah
contract and Musharakah whereby the Takaful operator as Mudarib also provides
capital in their investment with Takaful participants. Both capital (funds) are invested
and the profit shared accordingly with an agreed ratio or share in accordance with
capital contribution.
The system provides for the Takaful funds in both cases of an Underwriting Surplus or an
Underwriting Deficit.
 Underwriting Surplus: If there is underwriting surplus on the Tabarru’ fund, some of
the following can be chosen provided promise (Wa’ad) is signed between Takaful
participants and Takaful operator, namely:46
 The underwriting surplus are kept as reserve in Tabarru’ fund account.
 Some of the surpluses are kept as reserve but some are distributed to the Takaful
participants in accordance with actuarial or risk management requirement.
 Some of the surpluses are kept as reserve but some are distributed between
Takaful participants and Takaful operator.
 Underwriting Deficit : If there is underwriting deficit on the Tabarru’ fund, the
Takaful operator are required to take care the deficit using loan (Qard). The loan will
be settled to the Takaful operator using Tabarru’ fund.47
3.2.6. BEST PRACTICE AND CHALLENGES
Islamic Banking
One of the practices of Islamic banking practices in Indonesia is financial inclusion through
Islamic micro financing that attempts to reach the medium and small segment of society
through Islamic Rural Banks, known as Bank Perkreditan Rakyat Syariah (BPRS). In 2011 and
2015, the number of BPRS operating becomes 163 in 2015 while in 2011 is about 155
institutions. Their total assets are growing from IDR 3.52 trillion in 2011 to IDR 7.74 trillion in
2015 (OJK Islamic Banking Statistic, December 2016). BPRS offers various financing products
for their costumers based on various principles approved by Shariah such as Murabahah,
Musyarakah, Mudharabah , Salam, Istisna’, and others.
44 The ‘Aqd Mudarabah practice is based on Fatwa of DSN-MUI Number 21/DSN-MUI/X/2001.
45 Mudarabah Mustarakah is based on Fatwa DSN No.51/DSN-MUI/III/2006.
46 This is based on Fatwa DSN No.53/DSN-MUI/III/2006 on Underwriting Surplus.
47 This is based on Fatwa DSN No.53/DSN-MUI/III/2006 on Underwriting Deficit.