Translating the Takaful Islamic Insurance: An Analytical Approach

Lukman Ayinde Olorogun

doi:10.24297/jssr.v3i3.3267

Abstract

In the last decades, Muslim societies have experienced multiple processes of modernization, as an example, in the area of finance. This marked among other things, the rise of Islamic finance particularly Islamic insurance (takaful). As a consequence, the number of Muslim literates in finance has increased tremendously as well as the number of texts, concerning Islamic legal rulings on Islamic financial transactions which involve Islamic insurance engaged in these finances. At the same time, the Islamic insurance has been channeled to compete or totally eradicate conventional insurance in the new Muslim financial markets or at least in the Islamic countries, and these has triggered disputes among the scholars as to the viability and originality of the Islamic insurance. The disputes over the originality and viability of Islamic insurance to replace conventional insurance might contribute to the emergence, in the Muslim countries, of a tradition of scholarly debates that would stress re-evaluation and innovation of the existing body of knowledge.

Highlights

Well-known specialists in Islamic finance Islamic insurance in Muslim countries, for example Ali al-Qurradaghi, Yousuf al-Shubayli, Sami al-Suwaylim, Abdul al-Rahman al-Sanad have contributed and shown that Islamic insurance is in line with the Islamic doctrine and as such, permissible in all forms and practices
Based on the above premises, this study aims to investigate the gaps between the conventional insurance and Islamic insurance
Olorogun vindicated the need to redefine the Islamic insurance on its real vision and mission and as such arrived at the definition below: Islamic insurance‟ is understood as the agreement between the Takaful company and the participants or policyholders who agree to participate and share in a stated group of risk through the contribution of an equitable amount

Summary

Introduction

Well-known specialists in Islamic finance Islamic insurance in Muslim countries, for example Ali al-Qurradaghi, Yousuf al-Shubayli, Sami al-Suwaylim, Abdul al-Rahman al-Sanad have contributed and shown that Islamic insurance is in line with the Islamic doctrine and as such, permissible in all forms and practices. The Islamic transmission delved into various parts of Islamic insurance physiologically These transformation began from the theory, definition, distinguish features, modules operandi regulations etc. While Islamic traditions of learning and scholarship before the mid-1970s was arguably presented and confined to Islamic monotheism, theology, and jurisprudence, immediately after the first Islamic economic conference held in Saudi Arabia in 1976 (Olorogun 2012), Islamic finance traditions of learning and scholarship have been transformed, in the last forty years This transformation is much more intense in the area of Islamic banking and Islamic insurance. Islamic insurance emerged and aimed to totally eradicate and replace the conventional insurance or at least compete with it To make this profession transparent and convincing to the current and intending operators, Muslim scholars either secular or traditional have strived to translate it into an effort which included definition, stated its distinguish features, designed its modules operandi, and types of industry‟s operational styles. The section, i.e. translation section, juxtaposes the conventional and Islamic versions on the four areas of concentrations as stated to adequately justify whether they are at par or not

Evaluations of Substances of Conventional and Islamic Insurance

Types of Conventional and Islamic Insurance Business

Conventional Insurance

General Insurance Business

Life Assurance Business

Composite Insurance Company

Islamic Insurance

Operational Substances of Islamic and Conventional Insurance

Conclusion