MicroTakaful  ( Islamic Micro Insurance ) Presented by: Muhammad Zubair Mughal Regional Head TAKAFUL PAKISTAN LIMITED
Contents <ul><li>Introduction </li></ul><ul><li>Microtakaful defined </li></ul><ul><li>Historical perspective  </li></ul><...
Introduction Micro-insurance defined: “ Generally, micro-insurance is viewed just like other normal insurance on small sca...
Introduction Cont’d. … <ul><li>MicroTakaful can help people improve. </li></ul><ul><li>Microtakaful will help them sustain...
Global Landscape of Microinsurance  <ul><li>Only eighty million out of the world's 2.5 billion poor are currently covered ...
Prospects in Pakistan <ul><li>Serious efforts at national level only picked up </li></ul><ul><li>during the last decade. <...
Prospects in Pakistan (Cont’d. …) <ul><li>Government’s initiatives – Rural support programs. </li></ul><ul><li>SMEDA. </li...
 
 
 
 
 
Fire Theft Rainfall Floods Agriculture Property Prices Hospitalisation Dental Optical Dread Disease Out-patient Health Sur...
 
 
 
Benefits of MicroTakaful
Health Marriage Death Prolonged Illness Education of Children Business Failure/Loss of Job Birth of Children Importance of...
Takaful Pakistan’s initiatives <ul><li>Coverage to over 100,000 low-cost houses. </li></ul><ul><li>Synergy with NGOs. </li...
Takaful Pakistan’s MicroHealth Products Center for Women Cooperative Development. (CWCD).  No of Lives covered   14000  Be...
Takaful Pakistan’s MicroHealth Products Ministry of Zakat & Ushar   No of Lives covered   100,000,0  Beneficiaries   (Husb...
Basic Elements of Takaful <ul><li>Mutuality and cooperation.  </li></ul><ul><li>Takaful contract pertains to Tabarru’at as...
Investment Income Operational Cost of Takaful / ReTakaful Claims & Reserves Surplus (Balance) P A R T I C I P A N T S’  T ...
Comparing Takaful to Conventional Insurance Issue Conventional Insurance Takaful Organization Principle Profit for shareho...
 
Takaful through Time <ul><li>Origins in the First Constitution of Madina. </li></ul><ul><li>The first Takaful company was ...
About Takaful Pakitan Limited  <ul><li>Takaful Pakistan is a joint venture of prestigious local & foreign institutions, in...
What is required? When there is a will, there is way!
End of presentation Jazzakallah khair ! [email_address]
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Al huda presentation on micro health takaful

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Al huda presentation on micro health takaful

  1. 1. MicroTakaful ( Islamic Micro Insurance ) Presented by: Muhammad Zubair Mughal Regional Head TAKAFUL PAKISTAN LIMITED
  2. 2. Contents <ul><li>Introduction </li></ul><ul><li>Microtakaful defined </li></ul><ul><li>Historical perspective </li></ul><ul><li>MicroTakaful schemes in other countries </li></ul><ul><li>Prospects in Pakistan </li></ul><ul><li>Incremental values – The Takaful advantage </li></ul><ul><li>Takaful Pakistan’s initiative </li></ul><ul><li>The way forward </li></ul><ul><li>Conclusion </li></ul>
  3. 3. Introduction Micro-insurance defined: “ Generally, micro-insurance is viewed just like other normal insurance on small scale for low-income people” MicroTakaful redefined : “ A mechanism to provide Shariah-based protection to the blue collared, under-privileged individuals at an affordable cost ”.
  4. 4. Introduction Cont’d. … <ul><li>MicroTakaful can help people improve. </li></ul><ul><li>Microtakaful will help them sustain their financial well being. </li></ul><ul><li>Feeling of togetherness & security. </li></ul><ul><li>Opens avenues for joint efforts for mutual benefits. </li></ul><ul><li>Cooperative approach and outlook. </li></ul><ul><li>Result oriented </li></ul><ul><li>Society benefits at large. </li></ul>
  5. 5. Global Landscape of Microinsurance <ul><li>Only eighty million out of the world's 2.5 billion poor are currently covered by some form of micro insurance. </li></ul><ul><li>Only 3% of poor lives are insured in India and China. </li></ul><ul><li>Only 0.3% of the poor are insured in Africa. </li></ul><ul><li>In 23 of the poorest 100 countries in the world, there is currently no identified micro insurance activity. </li></ul>
  6. 6. Prospects in Pakistan <ul><li>Serious efforts at national level only picked up </li></ul><ul><li>during the last decade. </li></ul><ul><li>Advent of Microfinance banks. </li></ul><ul><li>Large rural/urban divide (65% : 35%) </li></ul><ul><li>40% population below poverty level. </li></ul><ul><li>Scope for extensive work. </li></ul><ul><li>Mushroom growth of NGOs. </li></ul>
  7. 7. Prospects in Pakistan (Cont’d. …) <ul><li>Government’s initiatives – Rural support programs. </li></ul><ul><li>SMEDA. </li></ul><ul><li>Financial Support from ADB, WB, etc. </li></ul><ul><li>State Bank’s initiative – 20% branches of commercial </li></ul><ul><li>banks required in rural areas. </li></ul><ul><li>Agriculture/Crop & Livestock Finance and Takaful. </li></ul><ul><li>Benefit of economies of scale to make these viable </li></ul><ul><li>ventures. </li></ul>
  8. 13. Fire Theft Rainfall Floods Agriculture Property Prices Hospitalisation Dental Optical Dread Disease Out-patient Health Surgical Disability Dismemberment Partial Permanent Temporary Total Credit Disability Life Insurance Credit Life Funeral Endowments “ Transition funds” Pensions Education Life Types of MicroTakaful Products
  9. 17. Benefits of MicroTakaful
  10. 18. Health Marriage Death Prolonged Illness Education of Children Business Failure/Loss of Job Birth of Children Importance of Risk/Economic Stress Potential areas of action
  11. 19. Takaful Pakistan’s initiatives <ul><li>Coverage to over 100,000 low-cost houses. </li></ul><ul><li>Synergy with NGOs. </li></ul><ul><li>Micro Takaful Health Products – CWCD & Sungi </li></ul><ul><li>Students Healthcare/Campus care cover </li></ul><ul><li>Factory workers’ & Daily wagers </li></ul><ul><li>Crop Takaful </li></ul><ul><li>Credit coverage for Islamic Microfinance. </li></ul><ul><li>Covers tailored for SMEs financing. </li></ul><ul><li>All above at ‘no profit basis’. </li></ul>
  12. 20. Takaful Pakistan’s MicroHealth Products Center for Women Cooperative Development. (CWCD). No of Lives covered 14000 Beneficiaries ( Husband and Wife ) Benefits: Hospitalization Rs. 35,000 Daily Room Limit Rs. 500 Maternity Rs. 5,000 (Sub limit) Rate per family Rs. 570
  13. 21. Takaful Pakistan’s MicroHealth Products Ministry of Zakat & Ushar No of Lives covered 100,000,0 Beneficiaries (Husband, Wife and 3 Children's) Benefits: Hospitalization Rs. 150,000 Individual Limit Rs. 25,000 Daily Room Limit Rs. 500 Maternity Rs. 5,000 (Sub limit) Rate per family Rs. 695/-
  14. 22. Basic Elements of Takaful <ul><li>Mutuality and cooperation. </li></ul><ul><li>Takaful contract pertains to Tabarru’at as against mu’awadat in case of conventional insurance. </li></ul><ul><li>Payments made with the intention of Tabarru (contribution) </li></ul><ul><li>Eliminates the elements of Gharrar, Maisir and Riba. </li></ul><ul><li>Wakalah/Modarabah basis of operations. </li></ul><ul><li>Joint Guarantee / Indemnity amongst participants – shared responsibility. </li></ul><ul><li>Constitution of separate “Participants’ Takaful Fund”. </li></ul><ul><li>Constitution of “Shariah Supervisory Board.” </li></ul><ul><li>Investments as per Shariah. </li></ul>
  15. 23. Investment Income Operational Cost of Takaful / ReTakaful Claims & Reserves Surplus (Balance) P A R T I C I P A N T S’ T A K A F U L F U N D (P.T.F.) Mudarib’s Share of PTF’s Investment Income Wakalah Fee Investment Income Management Expense of the Company Profit/Loss S H A R E H O L D E R S’ F U N D (S.H.F.) Participant WAQF Takaful Operator Share Holder Investment by the Company The Takaful Advantage
  16. 24. Comparing Takaful to Conventional Insurance Issue Conventional Insurance Takaful Organization Principle Profit for shareholders Mutual for participants Basis Risk Transfer Co-operative risk sharing Value Proposition Profits maximization Affordability and spiritual satisfaction Laws Secular/Regulations Sharia plus regulations Ownership Shareholders Participants Management status Company Management Operator Form of Contract Contract of Sale Cooperative, Islamic contracts of Wakala or Mudarbah with Tabar’ru (contributions) Investments Interest based Sharia compliant, Riba-free Surplus Shareholders’ account Participants’ account
  17. 26. Takaful through Time <ul><li>Origins in the First Constitution of Madina. </li></ul><ul><li>The first Takaful company was set up in Sudan in 1979, almost simultaneously followed by another one set up in Bahrain. </li></ul><ul><li>There are now around 179 Takaful companies in over 40 countries. </li></ul><ul><li>Poor Insurance rate in the Muslim countries (<1% of GDP). </li></ul><ul><li>Average growth rate higher than conventional insurance companies (around 25%). </li></ul><ul><li>Non–Muslims increasingly opting for Takaful products for commercial benefits. </li></ul>
  18. 27. About Takaful Pakitan Limited <ul><li>Takaful Pakistan is a joint venture of prestigious local & foreign institutions, including: </li></ul><ul><ul><ul><li>Emirates Investment Group (Sharjah). </li></ul></ul></ul><ul><ul><ul><li>Al-Buhaira National Insurance Co. (U.A.E.) </li></ul></ul></ul><ul><ul><ul><li>Al-Rajhi Banking Group – Saudia Arbia </li></ul></ul></ul><ul><ul><ul><li>House Building Finance Corporation. </li></ul></ul></ul><ul><ul><ul><li>Emirates Global Islamic Bank. </li></ul></ul></ul><ul><ul><ul><li>Arif Habib Securities. </li></ul></ul></ul><ul><ul><ul><li>Sitara Chemicals. </li></ul></ul></ul><ul><li>Large initial paid-up Capital. </li></ul>
  19. 28. What is required? When there is a will, there is way!
  20. 29. End of presentation Jazzakallah khair ! [email_address]

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