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  • Takaful Insurance Business

    • Article (5) Practicing Takaful Insurance Business

      Takaful Insurance business shall be practiced by licensed Takaful Insurance Companies only.

    • Article (6) Types of Takaful Insurance

      Direct Takaful Insurance activities are classified into three types:

      1. Takaful Insurance of persons and funds accumulation operations.
      2. Property Takaful Insurance.
      3. Liability Takaful Insurance.

    • Article (7) Classes of Personal Takaful Insurance

      Personal Takaful Insurance includes the following classes:

      1. Family Takaful Insurance of all forms.
         
      2. Health Takaful Insurance of all forms.
         
      3. Personal Accident Takaful Insurance associated with family Takaful insurance.

    • Article (8) Classes of Property and Liability Takaful Insurance

      Property and Liabilities Takaful Insurance includes the classes referred to in Article (5) of the Executive Regulation, provided that they do not include anything that contradicts Islamic Shari’ah Provisions.

    • Article (9) Combining Takaful Insurance Types

      9.1The Company may not combine the business of Personal Takaful Insurance and the business of Property and Liability Takaful Insurance.
      9.2As an exception to Article (9.1) above, an existing Company that is licensed to carry out both types of insurance may continue to do so in accordance with the Article (25) of the Law.

    • Article (10) Management of Takaful Insurance Operations

      Risk management and investment operations associated with Contributions shall be carried out by the Company on the basis of Wakala or Wakala and Mudaraba or any other form, provided that it is approved by the Central Bank and the HSA. The relationship between the Company and the Participant must be subject to these provisions stated in the Participation Membership Policy (“PMP”).

    • Article (11) Participation Membership Policy

      11.1The Company shall develop Participation Membership Policy to offer it to those who wish to subscribe in the Participants’ Account for any type or class of Takaful Insurance. The policy must be signed by both parties and a copy should be given to the Participant. The following must be taken in consideration when preparing the PMP:
      1. The PMP must be separate from the Takaful Insurance Policy, which must be consistent with the principles stated in the PMP.
      2. The PMP must address the bases and rules governing the Takaful relationship between the Company and the Participant, including the legal nature of this relationship.
      3. The PMP must elaborate that payments made by the Participant are made as donation (Tabarru’) commitment and/or investment for part of it, as applicable.
      4. The PMP must name the account in which the Participant will participate in.
      5. The PMP must disclose that the Company provides goodwill loan (Qard Hasan) when the assets of Participants’ Account are insufficient to repay the obligations incurred on such account.
      6. The PMP must state the amount of Wakala fees due to Company and the method of its calculation, as well as the share of the Company from the Mudaraba profit or Wakala fees for investing the Participants’ Account and the method of calculating such share or fees.
      7. The PMP must disclose the information that relates to the Company's policy for investing the portions allocated for investment from the Contributions, provided such policy is compliant with the Islamic Shari’ah Provisions.
      11.2The PMP mentioned in Article (11.1) must be approved by the Company's ISSC.
      11.3The PMP must then be presented to the Central Bank for approval before offering it to those concerned.
      After soliciting the opinion of the HSA, the Central Bank may object to the PMP contents if incorporating any provisions in contrary to legal provisions or Islamic Shari’ah Provisions, or if containing an explicit prejudice to the interests of the Participants.
      11.4The Company must maintain a record of PMPs. Such record shall be subject to inspection and audit by the Internal Shari’ah Supervision Committee and the Central Bank.