Tunisia – Finance: Zaytuna Takaful, insurance can also be Islamic

Radio Zitouna Zaytuna Bank and Takaful Zaytuna some time, the appellation is the same, activities vary, but come together in a single path: that of communication in different forms. The Zaytuna label is becoming more and more in the Tunisian economic landscape.

Zaytuna Takaful will be an insurance company governed by the laws of the insurance sector in force in Tunisia and is subject to 100% with all legal requirements and regulations governing the insurance industry in our country.  It will market all products under the legal texts, provided they conform with the principles of Islamic finance, especially for this product “Life”.  Life insurance capitalization is not allowed in Islamic insurance.

The official start of Zaytuna Takaful is not for tomorrow, we are still in consultations, study the information system should be adopted by the company, the choice of teams, installation and implementation of insurance products.

The term Takaful means mutual guarantee or indemnity between group members.  In addition to the cooperative sharing of risk, there is a clear distinction between participant and operator.  There is a clear separation between capital invested by shareholders and the funds deposited by applicants.  Shareholders commit funds and charge a commission usually set to 25%.

In Takaful, said Lawrence Zaatar, an expert in Islamic finance, there is no mutuality without community, and therefore no insurance possible outside of it.  The contracts are designed as a donation on behalf of policyholders.  The surplus is redistributed to subscribe to participants so that the Shareholders have no control on underwriting profits.  The investment Takaful Insurance must also be placed in interest-free funds and approved by the Shari’a.  Operators must submit more as managers than insurers in the conventional sense.

According to Catherine Stagg-Macey, senior analyst and author of a study published by the U.S. firm Celent, a research and consulting, the Takaful system’s potential is enormous because the penetration of insurance does not exceed 1% Gross domestic product in Muslim countries.  The skills and resources can be borrowed from the markets of traditional insurance.

Projections of the Institute of Banking and Islamic Insurance, the rate of growth of Takaful insurance is estimated between 15% and 20% and the market should reach 7.4 billion USD in premiums in 2015.

Our Ministry of Finance apparently initiated studies on the form of Takaful insurance.  To be continued.

• About Takaful

The Takaful, which is based on principle I’entraide Ie was born in Malaysia in the early eighties.  The client of a Takaful operator may have a similar function of the member in mutual companies. To better organize this new insurance business, regulators are hard at work, including I’Islamic Financial Services Board, based in Kuala Lumpur (capital of Malaysia). It must be said that Takaful products continue to grow with the leader among the Retakaful, Islamic reinsurance.  One hundred and ten companies already offer such services and only six are of Retakaful for Takaful companies are forced to sell their business primarily to companies Retakaful. Now, the Islamic countries and major international insurance groups work together to consolidation system.  For Takaful insurers are well advised to learn from the experience of conventional insurance.  As such, the insurer Prudential is cooperating with Saudi Arabia and Malaysia to distribute Islamic insurance products.              

Source : wmc translated

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