Takaful is a form of Islamic insurance in which members pool their funds to protect each other against loss or injury.
Takaful insurance is founded on sharia, or Islamic religious law, which describes how people are obligated to work together and protect one another.
The family Takaful insurance in Pakistan provides coverage for health, life, and other types of insurance.
Takaful is an Islamic insurance system that is built on the notion of mutual aid and solidarity, which is fully articulated and expounded on in the Holy Quran and Hadith.
The cornerstone of family takaful insurance in Pakistan is a contribution, mutual collaboration, and understanding amongst one another.
In a takaful agreement, all parties or policyholders agree to guarantee each other and contribute to a pool or mutual fund instead of paying premiums.
The takaful fund is made up of all of the donations that have been collected.
The amount of money each member contributes is determined by the sort of coverage they need and their particular circumstances.
A takaful contract, like a traditional insurance policy, outlines the type of the risk and the period of the coverage.
An operator manages and administers the takaful fund on behalf of the members, charging an agreed-upon fee to cover costs.
Costs include sales and marketing, underwriting, and claims handling, much like a traditional insurance firm.
Members’ claims are paid from the takaful fund, and any surpluses after making provisions for the expected cost of future claims and other reserves belong to the fund’s participants, not the takaful operator.
Takaful Company’s Basic Principles
Following are three key principles of a Takaful corporation:
- Participants contribute to the pool’s funding and become members.
- The funds are released according to the pool’s rules and regulations.
- Surplus cash might be redistributed among participants in whole or in part.
These three concepts are intertwined, and they are subject to official laws and regulations. As a result, members contribute to the Pool, which compensates for their losses when they are in need.
Takaful Insurance vs. Traditional Insurance
Conventional insurance is undesirable in Islam, according to the majority of Islamic jurists, since it violates sharia.
Al-gharar, or uncertainty, is a component of traditional insurance.
It is founded on the concept and practice of interest charging. Islamic insurance, on the other hand, is based on tabarru, which treats a percentage of members’ payments as a gift.
This is why takaful or family Takaful in Pakistan policyholders are often referred to as participants.
Furthermore, traditional insurance is regarded as a type of gambling.
List of Banks in with Takaful Insurance
The below mentioned are the biggest names in the Takaful insurance market.
- Islamic Insurance Company
- Standard Chartered
- Takaful Brunei Darussalam Sdn Bhd
- Prudential BSN Takaful Berhad
- Zurich Malaysia
- Takaful Malaysia
- Qatar Islamic Insurance Company.
Traditional insurance is still common in many Muslim countries, but due to social and economic changes, there are now more options available for the best Takaful Insurance in Pakistan.
Takaful is one of these, provided by insurance companies and tailored to meet the needs of people from different Islamic backgrounds.