Takaful (Islamic Insurance)
Cooperative system of mutual protection, distributing risk among participants.
Detailed Description
Takaful (Islamic Insurance)
What is the main concept behind Takaful?
Takaful is based on mutual assistance and shared responsibility among participants who contribute to a common fund to support each other.
How does Takaful differ from conventional insurance?
Takaful involves risk sharing among participants, while conventional insurance transfers risk to an insurer and aims for profit maximization.
What are the two main types of Takaful?
The two main types are Family Takaful, which focuses on life insurance, and General Takaful, which covers non-life insurance needs.
What role do regulatory bodies play in Takaful?
Regulatory bodies ensure Takaful operations comply with both Islamic financial principles and local insurance regulations.
What challenges does Takaful face in its growth?
Challenges include lack of awareness, regulatory hurdles, competition from conventional insurance, and investment limitations due to Sharia compliance.