Diversification of Islamic Financial Insturments
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Figure 11. Hybrid Wakala Waqf Mudarabah Model Used in Pakistan
Source: Created by Author
In contrast, in General Takaful, there is no separate PTF, and the Participants’ Investment Fund
itself acts as the Waqf fund.
In both business models, the income of the Takaful operator is both in the form of a Mudarib
(for managing the investments of the PIF) and as a Wakeel (fixed percentage fee charged for
operating the Waqf fund). In cases where there is a surplus in the Waqf fund (contributions
exceeding claims in a financial period), with the approval of the Shariah Board of the Takaful
Operator, the surplus is either
 Used to pay back any Qard-Hasan from shareholders, taken previously in case of
deficit
 A portion of the surplus is kept as a reserve, to mitigate for future losses.
 The remaining portion is distributed among the participants of the fund
Note that, as per SECP regulations, it is not incumbent for Takaful operators to have a Shariah
Board. The minimum requirement is that of one qualified approved Shariah Advisor. However,
a few full-fledged operators such as Pak Qatar Takaful and Dawood Family Takaful have their
own Shariah Boards.