- Research Handbooks in Financial Law series
Edited by Julian Burling and Kevin Lazarus
Chapter 20: Takaful Insurance: Squaring the Insurance Circle in Islamic Law
JOBNAME: Lazarus PAGE: 1 SESS: 3 OUTPUT: Wed Dec 21 15:05:32 2011 20 Takaful insurance: squaring the insurance circle in Islamic law Mark Hoyle 1. INTRODUCTION Islamic insurance is usually referred to as ‘takaful’, which essentially means ‘sharedresponsibility’ or ‘guaranteeing each other’. It is derived from the word ‘kaﬂ’, which means ‘guarantee’ or ‘responsibility’. Takaful insurance is based on rules and principles either derived from, or consistent with, the Sharia (and Islamic law), and can be characterised as an Islamic form of cooperative or mutual insurance, but one which is available to the general public. In order properly to understand the issues facing takaful, the structures and principles behind takaful must be understood. The legal and regulatory framework surrounding takaful is still in its infancy, with the most developed systems of Islamic ﬁnance and takaful being found in Malaysia. Although several Middle Eastern, Asian and some European countries offer takaful insurance products, they do not all have the legal and regulatory framework in place that is necessary to ensure competitiveness in the market place, stability, transparency and efﬁcient ﬁnancial reporting. This chapter will outline the basic concepts and structures of takaful insurance and attempt to deal with some of the legal and regulatory issues facing takaful around the world. 2. TAKAFUL Under a takaful system of insurance, participants make contributions to a fund to cover claims for insured events, whilst also beneﬁting from any returns generated by the investment of the fund in Sharia-compliant vehicles....
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.