This requires written endorsement by the Sharia Committee and approval by the Board of Management," explained Mr Tobias Frenz, Head of Munich Re Retakaful based in Kuala Lumpur.
added that the Malaysia Takaful Association
(MTA) has also completed a survey of four general takaful companies to understand the cause of leakage in Malaysia.
pointed out that while methods may vary, the important thing is for Shariah compliance to prevail.
"We have discussed these issues within the MTA General Retakaful Treaty Wordings Sub-committee
The members concurred that we would not want to mandate what operational model retakaful operators can apply, as long as it is compliant," he
Hence for instance, there is a broad agreement on the topic of pooling that it would be done across cedants instead of one-company pools.
But whether the pool is segregated by line of business, country, region or even globally is left to the individual retakaful operator depending on its risk and capital management considerations, he
The main vision for takaful since inception remains to create an inclusive insurance environment taking into account religious sensitivities, which would ultimately lead to increased penetration globally.
In that regard, there has been a visible increase in insurance penetration owing to influence to takaful in places like Malaysia and pockets of the GCC.
However, pro-active support on the part of regulators and government has proven to go a long way for takaful to make a strong impact, said Mr Frenz
Opportunities lay in niche areas for a start, such as microtakaful, said Mr Frenz