Al-Huda Centre of Islamic Banking & Islamic Economics

1
Al-Huda Centre of Islamic Banking Islamic
Economics

• Event

Two Days Specialized Training Workshop on Takaful
(Islamic Insurance)
Presentation Topic
Insurance Industry in Pakistan A Review
Takaful-Understanding the Concept
Presentation by
Prof. Dr. Khawaja Amjad Saeed
Principal, Hailey College of Banking
Finance University of the Punjab, Email
kamjadsaeed_at_yahoo.com
Venue, Date Time
Avari Hotel, Lahore. August 10-11, 930
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Insurance Industry In Pakistan A Review TAKAFUL
Understanding The Concept
WELCOME TO OUR PROGRAM
Prof. Dr. Khawaja Amjad Saeed

• PRESENTATION FRAME
• A Insurance In Total Framework
• B Insurance Policy
• C Takaful

Principal, Hailey College of Banking Finance,
University of the Punjab, Lahore-Pakistan
Email kamjadsaeed_at_yahoo.com Website
www.kamjadsaeed.edu.pk Mob [phone] Member
Governing Council, International Federation of
Accountants (IFAC) (1997-2000), President, South
Asian Federation of Accountants (SAFA) (1997),
President, Institute of Cost and Management
Accountants of Pakistan (1997-2000), President,
Association of Management Development
Institutions of South Asia (AMDISA) (1993-96),
Pro Vice-Chancellor University of the Punjab,
Lahore (1994-1996), Founder Director, Institute
of Business Administration (IBA), University of
the Punjab, Lahore (1973-1996).
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A Insurance in Total Framework

• Sources
• Inspiration
• Pakistan Insurance Companies
• KSE Listed Insurance Companies
• KSE Par Value Analysis
• KSE Total and Insurance Sector
• SLIC Growth of Number of Policies and Lives
  Covered
• Products Offered as Revenue Drivers
• KSE Top Ten Insurance Companies Gross Premium
  Written 2005

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B Insurance Policy 2007 C Takaful

• Protection Certain Basic Right
• Al-Takaful
• Takaful-Inretrospect
• Main Takaful Operations
• Global Takaful Sector
• Types f Main Takaful
• Family General Takaful
• General Takaful
• Five Takaful Scheme
• Information Needed

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B Insurance Policy 2007 C Takaful

• 11. Motor, Accident Liability Takaful Schemes
• Engineering Takaful Scheme
• House Owoners Householders Scheme
• Family Takaful
• Family Takaful Plan
• Family Takaful Individual Group Plans

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A-1 Sources

• Downloads from Internet-2007.
• Insurance Policy of Pakistan, April, 2007.
• Pakistan Gulf Economist, Karachi Various
  Issues.
• ICIEF Work, Malaysia.
• Journal of Islamic Banking Finance, Karachi.
• Sharing thoughts with Scholars in Malaysia 2006.

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A-2 Inspiration Takaful (Islamic Insurance)

• Instead of turning more clerks and government
  servants, your College is now offering suitable
  subjects for students which would enable them to
  take place in
• Commerce
• Trade
• Industry
• Banking
• Insurance Business
• It should be the aim of our college to produce
  first class experts in---- specialized subjects
• Quaid-e-Azam Address in Edwards College,
  Peshawar, April 18, 1948.

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A-3 Pakistan Insurance Companies
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A-4 KSE Listed Insurance Companies
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A-5 KSE Listed Insurance Companies Par Value
Analysis
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A-6 KSE Total Insurance Sector April 27, 2007
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A-7 SLIC Growth of number of Polices Lives
Covered
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A-8 Products Offered as Revenue Drivers
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A-9 KSE Top Ten Insurance CompaniesGross
Premium Written 2005
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B Insurance Policy 2007

• 1 Aim
• 1. Increase penetration.
• 2. Remove impediments to insurance.
• 3. Rational role of public sector in line with
  international practices.
• 4. Increase coverage from 0.28 to1.00 in 3
  years.
• 2 Contribution
• 1. Increase savings
• 2. Risk investigation
• 3. Capital formation and investment levels

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B Insurance Policy 2007

• 3 Strategy
• 1. Improve coverage and outreach.
• 2. Areas
• - Health
• - General
• - Micro Insurance
• 3. SLIC conversion into company
• 4. Postal life insurance-company with insurance
  law
• 5. Public sector insurance entities to be
  corporatized

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B Insurance Policy 2007

• 3 Strategy
• 6. BODs be strengthened with professionals
• 7. Aggressive marketing
• 8. Open insurance of public property to private
  insurance companies
• 4 Ministrys Suggestions
• 1. Introduction of Takaful
• 2. Others--------
• SourceExtracted from Daily Times Dawn, April
  14, 2007

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C TakafulC-1 Protection of Certain Basic
Rights

• The Right of protect
• Religious
• Life
• Dignity/Honour
• Property
• Mind

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C TakafulC-2 Al-Takaful

• Joint guarantee.
• Pact among a members or participants who agree to
  jointly guarantee among themselves against loss
  or damage.

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C TakafulC-3 Takaful Inretrospect

• - Started 28 years ago
• - UAE The Islamic Arab Insurance Co.
• - Sudan Islamic Insurance Co.
• - 1984 Malaysia
• - Pioneering role
• - First legal framework (Takaful Act)
• - Sudan Iran
• - Islamic Regulatory environment
• - Now movement has been blossomed

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C TakafulC-4 Main Takaful Operations

• - Estimate.
• - 60 Takaful companies.
• - 3 Retakaful companies.
• - Takaful windows.
• - One of the fastest growing segments in
  insurance.
• - 20 p.a average growth.

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C TakafulC-4 Main Takaful Operations

• - World takaful contributions
• - General takaful 60
• - Family takaful 40
• 100

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C TakafulC-4 Main Takaful Operations

• Geographical Spread
• 1. South East Asia 56
• 2. Family Takaful Middle East 36
• 3. Africa 07
• 4. Europe, USA Other 01
• 100

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C TakafulC-5 Global Takaful Sector

• Leading Countries
• Malaysia
• Indonesia
• Saudi Arabia
• USA
• Iran
• UAE

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C TakafulC-5 Global Takaful Sector

• Leading Countries
• Egypt
• UK
• Kuwait
• Algeria
• Qatar
• Jordan

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C TakafulC-6 Types of Main Takaful

• The commercial activity of takaful is reflected
  in two basic types of business that it
  undertakes.
• The types of business are as follows
• - General Takaful
• - Family Takaful Business

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C TakafulC-7 Family General Takaful
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C TakafulC-8 General Takaful

• Fire takaful scheme
• Motor takaful scheme
• Accident takaful scheme
• Liability takaful schemes
• Engineering takaful schemes
• House owners Householders Takaful schemes

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C TakafulC-9 Fire Takaful Scheme
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C TakafulC-10 Information Needed

• Location of Building
• Structure of Building
• Type of Building
• Occupation of Building
• Sum covered

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C TakafulC-11 Motor, Accident Liability
Takaful Schemes

• Motor Takaful Scheme
• Private Car/Motorcycle
• Accident Takaful Scheme
• Personal Accident
• Group Personal Accident
• Liability Takaful Scheme
• Employers Liability Takaful
• Public Liability
• Workmens Compensation
• Contractors All Risk

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C TakafulC-12 Engineering Takaful Scheme

• Machinery Breakdown Takaful
• Loss of Profits Due to Machinery Breakdown
• Boilers and Pressure Vessel
• Erection All Risk
• Storage Tanks
• Marine Cargo (Inland Transits)
• Marine Cargo (By Sea)
• Marine Cargo (by Air)

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C TakafulC-13 House Owner's Householder's
Takaful Scheme

• Coverage House Owners
• Cover against loss or damage of building (house).
• House Holders
• Cover against loss or damage of household
  contents.
• Scope of Cover
• Fire, lightning, thunder and underground fire
• Explosion
• Aircraft damage
• Impact damage
• Bursts or overflow from water tanks, pipes or any
  facilities
• Theft caused by forcible entry

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C TakafulC-13 House Owner's Householder's
Takaful Scheme

• Scope of Cover
• Tidal waves, hurricane, thunderstorm or heavy
  rain
• Earthquake and volcanic explosion
• Flood
• Liability to the public
• Loss of rent up to 10 of sum covered of the
  house.
• Eligibility
• Individuals owning a house

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C TakafulC-14 Family Takaful Scheme

• The modus operandi for Islamic Insurance
  companies operating life business are almost
  similar but more clarification is needed. Life
  policies are issued in the name and style of
  Family Takaful Scheme.
• Each installment paid by the participants is
  divided and credited into two separate accounts
  namely The Participant Account and the Special
  Account

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C TakafulC-14 Family Takaful Scheme

• The amount that is credited into these two
  accounts is invested as per Shariah Code and
  profits are shared between the Participants and
  the company in an agreed ratio. The major portion
  of the profit (say 80) is paid to the policy
  holders and the company is entitled to get the
  balance amount of the profit only.

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C TakafulC-15 Family Takaful Plan

• INTRODUCTION
• With the Family Takaful Plan you can be assured
  of a certain sum of money which will go a long
  way to ease the financial burden of your loved
  ones in the event of your untimely death. You
  will enjoy tax relief too from your Takaful
  installment.

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C TakafulC-16 Family Takaful Plan
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C TakafulC-16 Family Takaful

• Flexible monthly installments.
• Long-term financial program to facilitate the
  creation of your personal savings and retirement
  fund.
• Choice of maturity periods between 10 to 40 years
  at your convenience.
• Supplementary over for hospitalization benefits,
  personal accident, permanent disability.
• Open to all individuals between the ages of 18 to
  55 years old.
• No forfeiture of your takaful installments in the
  event of cancellation.
• Facility of part withdrawal.

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C TakafulC-16 Family Takaful

• Purpose
• A systematic savings and investment program that
  could grow into a long-term fund for your family
  endowment in case of your untimely death before
  the maturity period.
• As an assurance to help you through with any
  financial tide in case of mishap such as
  accident, permanent disability or to finance your
  hospitalization bills
• Eligibility
• Open to all individuals aged between 18 to 55
  years old.

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C TakafulC-16 Family Takaful

• Maturity Period
• 10 Years
• 15 Years
• 20 Years
• 25 Years
• 30 Years
• 35 Years
• 40 Years

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C TakafulC-16 Family Takaful

• Supplementary Cover
• Permanent Total Disability
• Personal Accident
• Hospitalization Benefits
• Mode of Payment
• Salary deduction
• Bank Standing Instruction
• Direct Payment by cash or cheque
• Credit or Charge Card

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ANY QUESTIONS THANK YOUR FOR ATTENTIVE LISTENING