Corporate And Joint Guarantee And It Is The Closest Islamic Instrument For Contemporary System Of Insurance

764 Words Nov 8th, 2016 4 Pages
Takaful means “mutual or joint guarantee” and it is the closest Islamic instrument to contemporary system of insurance. Earlier demand for insurance was very low in Muslim communities compared to conventional markets but with the introduction of Islamic mode of insurance more and more Muslims are open to the idea.
Currently there are very few Takaful applicants in the market with very few institutions offering this insurance service on large scale. Though the claim for Takaful is for part insurance based and limited to loss of physical property, there are products in the market targeting family and medical coverage based on shariah principles (Ernst & Young, 2009).
As per to (Ernst & Young, 2009) following trends are seen in Takaful market
 Gulf cooperation council remains as the strong hold of Takaful with more than half of the global Takaful market
 Malaysia holds the strongest position in Southeast Asia and it has set an example how financial awareness to customers can make a difference. Some banks in Malaysia has over 50 percent non-Muslim Takaful customers and over 70 percent sigh of successful integration of Takaful in Malaysia
 There has been an increase in number of joint ventures between local and international finance institutions
 As it is very important to educate the customers about the Takaful and its transparency, programs are being designed with a joint effort between banks, insurance and Takaful.
Takaful models can be mainly of mudarabah, wikala and a…

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