Co-operative Insurance (Takaful): A Sharia-Compliant Insurance Solution for Policyholders

Introduction to Co-operative Insurance (Takaful)
Co-operative Insurance (Takaful) is a unique form of insurance based on Islamic principles of mutual cooperation and shared responsibility. Unlike conventional insurance, Takaful operates according to the rules of Sharia law, promoting ethical conduct, fairness, and transparency. Our company conducts its operations with a commitment to Sharia-compliant insurance, ensuring that all financial dealings align with the moral principles of Islam.

Wakala & Mudarib Fees: Key Components of Takaful
In our Takaful model, we manage the policyholders’ accounts as an agent, known as Wakala, ensuring smooth transactions and transparent operations. We charge an annual fee for these services, which is set and approved by the Sharia Supervisory Board. As of July 1, 2021, the Wakala fee has been set at 25% of the Takaful contributions. Prior to this change, the fee was 20%.

Additionally, we operate as Mudarib—an investment advisor managing the policyholders’ funds. In return for our services, we receive a portion of the profits generated from the investments. As of July 2021, our percentage of profit-sharing has been raised to 60%, an increase from the previous 40%. This adjustment was made in consultation with the Sharia Supervisory Board to ensure fairness and profitability for all stakeholders involved.

Accounts Separation and Surplus Distribution
To ensure transparency and fairness, our company maintains separate accounts for all policyholders. Contributions made by policyholders, along with the returns from their investments, are credited to these accounts. The accounts are also debited by claims, reinsurance contributions, necessary provisions, reserves, and the Wakala fee.

Any surplus funds, if available, are distributed to the policyholders. The distribution is based on the proportion of contributions each policyholder has made. The final decision on how the surplus is distributed is made by the Board of Directors, with approval from the Sharia Supervisory Board. This process ensures that policyholders receive a fair share of any surplus in accordance with Sharia law principles.

Liquidation Process and Charitable Distribution
In the event of the company’s liquidation, all funds accumulated in the policyholders’ accounts are redistributed. However, instead of being distributed among the policyholders, the funds are donated to selected charities. The Sharia Supervisory Board supervises the distribution of these funds to ensure they are used in compliance with Sharia principles. This ensures that the company’s assets are used in a socially responsible manner, even in the event of closure.

Our Website:-www.beema.com.qa