Presentation on theme: "Introduction to Takaful &"— Presentation transcript:
1Introduction to Takaful & MicroTakafulPartnering with peopleCapt. M. Jamil Akhtar KhanACII, MCIT, Master MarinerChief Executive OfficerTAKAFUL PAKISTAN LIMITED
2Contents Introduction Benefits of MicroTakaful The Takaful advantage Global LandscapeTakaful ProductsProspects in PakistanInitiatives by Takaful Pakistan
3IntroductionThe word ‘Takaful’ has been derived from the Arabic root word ‘ Kafala’ meaning ‘mutual guarantee’.It is risk-sharing instead of risk-transfer.Takaful is a practical manifestation of the Quranic injunction for mutual co-operation and assistance for the common good/benefit.It encompasses the predominant elements of social good, brotherhood and solidarity – founded on the core Shariah principles.By doing so, one gets benefited – from cradle to grave and even in the Hereafter!
4Introduction Micro-insurance defined: “Risk-pooling products that are designed to be appropriate for the low-income market in relation to cost, terms, coverage, and delivery mechanisms”.MicroTakaful refined:“A mechanism to provide Shariah-based protection to the blue collared, under-privileged individuals at an affordable cost”.
5Benefits of MicroTakaful Helps people sustain their financial well being.Creates feeling of togetherness & security.Opens avenues for joint efforts for mutual benefits.Cooperative approach and outlook.Result s in migration of benefits at individual level.Ensures that Society benefits at large.
6The Takaful Advantage WAQF S H A R E H O L D E R S’ F U N D (S.H.F.) Wakalah FeeInvestmentIncomeMudarib’s Share of PTF’s Investment IncomeManagement Expense ofthe CompanyProfit/LossTakaful OperatorInvestment bythe CompanyWAQFOperational Cost of Takaful / ReTakafulInvestmentIncomeClaims &ReservesSurplus (Balance)ParticipantP A R T I C I P A N T S’ T A K A F U L F U N D(P.T.F.)
7The Takaful Advantage“ … they seemed satisfied with the convenience and affordability of the policy, but some thought that the premium should be reimbursed if they do not file a claim”. Excerpt from The Demand for Micro insurance in Pakistan by ELIZABETH MCGUINNESS AND VOLODYMYR TOUNYTSKY MARCH 2006
8Global LandscapeOnly eighty million out of the world's 2.5 billion poor are currently covered by some form of micro insurance.Only 3% of poor lives are insured in India and China.Only 0.3% of the poor are insured in Africa.In 23 of the poorest 100 countries in the world, there is currently no identified micro insurance activity.
14Takaful prospects in Pakistan 97% Muslim population.Demand for insurance increasing with increase in per capita income.Personal lines insurance business (leasing, health, medicare) growing at a higher rate than the other conventional classes.Islamic banking on sound footing with support of the government.MicroTakaful.
15Takaful Pakistan’s Initiatives Coverage to over 100,000 low-cost houses.Synergy with NGOs.Students’ Healthcare/Campus Care CoverFactory workers’ & Daily wagersCrop & Livestock TakafulCredit coverage for Islamic Microfinance.Covers tailored for SMEs financing.All above at ‘no profit basis’
16Conclusion Takaful defined Benefits & Advantage International scenario Takaful ProductsProspects in PakistanTakaful Pakistan’s Initiatives