2. Presentation on Takaful An emerging niche market By: Capt. M. Jamil Akhtar Khan ACII, MCIT, Master Mariner Managing Director The Universal Insurance Company Ltd. International Conference on Islamic Banking & Finance KABUL; June 8 & 9, 2010.

4. Introduction to Takaful

10. Objections to Conventional Insurance

16. 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. Takaful Through Time

21. Takaful Models

23. Profits attributable to Shareholders Company’s Admin. & Mangt. Expenses Takaful Contribution paid by Participant General Takaful Fund General Takaful Fund Operational Cost of Takaful Surplus (Profit) Participant’s Share from Surplus Company’s Share from Surplus Company Participant Mudaraba Model Investment By Company Profit From Investments

25. General Takaful Fund Operational Cost of Takaful/ ReTakaful Surplus (Profit) Surplus Distribution to Participants Participants’ Takaful Fund Wakala Model Takaful Contribution paid by Participant Company (Capital) Mudarib's’ Share of PTF’s Investment Income Management Expense of the Company Profit/Loss attributable to Shareholders Wakala Fee (30% to 35%) Profit From Investments Investment Income Reserves Investment by the Company Investment Income Sharing on Mudaraba Basis

27. 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 Wakala-Waqf Model Investment by the Company

29. ISLAM AQIDAH Faith & Belief SHARIAH Practices & Activities AKHLAQ Moralities & Ethics IBADAH Man-to-God Worship MUAMALAT Man-to-Man Activities Social Activities Economic Activities Political Activities Risk Management Takaful

35. Objectives Resolution 1949 1992 1983 Review by Council of Islamic Ideology Report by the Council 2000 Insurance Ordinance 2005 Takaful Rules T I M E L I N E – T A K A F U L I N P A K I S T A N

41. Thank You CENTER OF ISLAMIC BANKING & ECNOMICS Head Office: 192- Ahmad Block, New Garden Town , Lahore, Pakistan Ph: +92-42-35913096-8, 35858990, 38407850 Fax: +92 -42-35913056 E-mail : [email_address] Web: http://www.alhudacibe.com