1 Jurisprudential issues in Takaful operation International Takaful Summit 2007, London. 1 st -2 nd November 2007.

2 Takaful operation - transforming the charity concepts into business proposition ……. Based on brotherhood, solidarity and mutual assistances; Generating business profit in the forms of underwriting surplus and investment returns; Involving modern business principles of underwriting processes, application of appropriate actuarial techniques and arriving at right investment decisions; End results: cut loses & alleviate financial difficulties.

3 Shariah issues in the conventional insurance ….. The presence of gharar, riba and gambling in the insurance; Resolved the issue through tabaru’ contract among the Takaful participants and wakalah contract in managing Takaful funds, mudharabah for investments and wadiah for the safe custodian of the funds

4 Jurisprudential or Shariah issues …. Selection of the models and its implications:- –Deduction of direct and indirect expenses, Retakaful, claims, IBNR, management expenses, underwriting cost and reserve; –Deficit in Takaful fund; –Provision for loss in investment; and –Distribution of surplus. Environmental conditions; Reinsurance and/or reTakaful; and Dispute resolutions.