Many lawyers have tried to explain the aims and objectives of the sharia, which is in the. These figures include the Abu Ishaq al-Maliki Shatibi, Abd al Shafite al-'Izz ibn AI-Salam, and the Hanbali Ibn al-Qayyim Jawiziyyah.1. Definition of maqasid Al Sharia
Maqasid al-Sharia, which has the objectives of the sharia, can be defined as follows:
· Maqasid al-Sharia covers these services and welfare and benefits for which Allah has revealed His Sharia.
· Maqasid al-Sharia aims at doing good, welfare, benefit, and so on, and ward off evil, injury, damage, etc., for the creatures. (All this is in Arabic terminology as al-Ibad masalih be specified.)
Islamic law aims at the welfare of people in this life and in the Hereafter, and has sent the effect, people can to such means and measures are taken (Sharia) as proposed in advantage / benefit of a good reason being, they can and ward off evil / harm / loss, etc. of them, not only in this world but also in the hereafter. It is the philosophy behind his commandments and worship prescribed to his creatures.0.2. Classification of Al-Sharia maqasid
The provisions of sharia are directed to the protection of its objectives. Objectives or maqasid al-Sharia be classified as:
Daruriyyah
Hajiyyah
Tahsiniyyah
Approves Sharia prohibits good and bad:
Recognizes and avoids undue burden ease
God is both "good" and "bad" was created. Good results in the goodness of man, and evil poor performance for him. Good results in Allah and the bad results of his wrath. The man has done for the good and avoid evil of sanctions imposed by the pursuit of pleasure of Allah, but was advised to avoid unnecessary things and make it easier to adopt for this purpose. God is not a commitment to the people, which is beyond their reach. Holy Quran says: God does not need a soul beyond its scope.
"He has chosen you and not placed on religion in any difficulty which the Quran is one of the purposes of prophecy of the Prophet (SAW) said these words." He forbid that are right and forbid what is wrong. It will allow all the good things and prohibit all bad things, and he frees them from their burdens and the shackles of those used to be used (7:157)Objectives of Shariah Immutable
The objectives of the sharia are eternal and immutable. They are set by Allah and their application or interpretation remains with the sweet will of a person or class. This is both worldly life and life is listed below, and only for worldly benefits at the expense of life in the hereafter, profits, is prohibited and condemned to drink. However, the sharia is considered in the case of darurah (need) and needs.
Sharia is a priority for all secular and religious matters and people were asked to follow these priority imposed, and not allowed to apply their whims, while after one of the two. Sharia has prohibited the use of some products and the indulgence in certain economic activities, although sometimes or always able to practice their use or economic progress or fruit. It has also enabled the Sharia and sometimes forced to do certain things or use the initiative of certain economic activities, although they do not seem to bear fruit as forbidden things. The philosophy behind the authorization or prohibition of certain products or economic activities is Allah (SWT) is known. However, some parts reveals and explains the Prophet (SAW). In all these offers, ensures ease Sharia, and has the lightness of illicit and prohibited and permitted activities if necessary (darurah). In this context, besides the verses quoted above, the following advice worth noting: "God intends to make it easier and he does not want to distress you." (2:158)
"God, the burden would be easy to do for you, for man was created weak." (4:28)
The Prophet (SAW) said: "/ have been shipped with a simple and viable Sharia."0.3. The aim of takaful
The main objective of Takaful is to spread the risk among the members. In practical terms, the main difference is in the range between conventional insurance and Takaful insurance, which will be assigned a risk to the insurer, while in takaful, the risk for both sides of the members of the takaful fund under common Takaful scheme divided.
Takaful can be used as a method of joint guarantee of the participants against loss or damage attributable to any of them (Fisher, 2002) can be added to be displayed. Group members jointly undertake to ensure that if one experiences a disaster is a certain amount of money to be fair, damages.
Support of social solidarity.
Help protect the community from the negative effects of adversity.
Improving the quality of life for the peace of mind that comes from security.
Save and invest money in a common system that distributes benefits on premiums invested (subscriptions and contributions) to the policy on an annual basis.0.4. Bases of the takaful
"... A system that provides for solidarity, peace of mind and reciprocal protection of investment of financial and other assistance to members of the group {} in the case of specific needs and require members to each other, provide funds to support this common goal, are based. " [O. Fisher]
"The fundamentals underlying the Takaful concept are very similar to the cooperative and mutual principles, to the extent that the cooperative and mutual model, which is acceptable under Islamic law is."
Despite the belief in God and Qadha-o-Qadr (the Divine decree and will of God), The Quran urges the person to support each other and take care to minimize possible injury, loss or damage due to events unfortunate. Although takaful has ancient origins, the modern word takaful use. It is linked to risk sharing and reciprocity in the Holy Quran and Hadith (report on the teachings and sayings of peace be with him the Prophet Muhammad), but Takaful, as is done today will be the secondary source of basis of Islamic jurisprudence - ijtihad (the process of decision-making by independent interpretation of sources, The Quran and the Sunnah - The traditions and practices of Prophet Muhammad).
The base of the Takaful system is not for profit, but the principle of truth "bear one another's burdens." Therefore, the characteristic feature of Islamic insurance, is not subject to non-profit self-help through cooperation. Mutual assistance between members of a tribe was not originally a commercial transaction and does not contain any profit or gain at the expense of others. On the contrary, has been developed as a social institution: the burden of an individual, leading to smooth its members (a group of people), or tribe. By contrast, modern insurance (including insurance company investments in stocks, but not reciprocal) is a venture capitalist based business, where losses in advance and funds (premiums) allocated to the risks of projections , to cover them. Premiums are paid according to the risk of such projections.
"It appears, in fact, is the fundamental difference between Islamic and conventional concepts from the perspective of insurance not economics. From a conventional perspective, as insurance of bilateral agreements that transfer the risk to benefit people who choose for making this contract. set from an Islamic perspective, however, it seems safe as an institution that reduces or eliminates the risk for the benefit of the social group is important for institutions that are either conventional or Islamic opinion in the context of the other is described. is an Islamic insurance company, an institution that would highlight the risk of individuals, like a conventional company is the possibility that a group of equity risk. "(Bird & Hays 1998, P152) Examples of the base, as mentioned in the Quran and Hadithare:v Principles of Cooperation:
"And help one another in righteousness and piety ..." [Quran 5:2]
"God always helps his servant as long as it helps others." (Reported by Abu Dawud Muslim scholar: 817-888)v concept of shared responsibility:
The place is on relationships and feelings of people with faith, including, as the body, when one of its parts with the pain, then the rest of the body affected, he said (by Islamic scholars Bukhari and 810-870 are persecuted Muslim ibn al-Hajjaj 0,821 to 875)v based on the mutual protection:
No one will enter Paradise, if not to protect his neighbor who is in need. (Narrated by Ahmad bin Hanbal Islamic scholar from -780 to 855)
Importantly, all economic activities, including the basic principles of Islamic law applicable to contracts in general, Islamic law. These include:
The contract first must not unlawful in Islam.
Second The objectives of the agreement must not conflict with the principles of Sharia.
Third The contract must be free of the following:
(I) Maysir / Qimar (games)
(Ii) gharar (degree of absolute or great uncertainty),
(III)-e-Ghaban Fāhish (price exploitation, exorbitant or the rate of profit)
(Iv) ikrah (forced)
Participants agreed fourth most-active contract cooperation for their common good.
Fifth Each participant in the contract pays a contribution to help those who need help.
Sixth The contract should not seek an unfair advantage derived from a participant at the expense of others.1. Elements of gharar, Maysir and Riba in insurance contracts
As a single breach of contract Riba, gharar and insurance rules. One party pays cash rewards in exchange for the promise of the other party to pay a sum of money in the occurrence of an uncertain future event. In this sense it is similar to a bet (maysir). In addition, most insurance companies invest their premiums in interest-bearing investments prohibited by Sharia (Islamic Law and Finance: Frank E Vogel and Samuel L. Hayes, III, 2006).v ghararv MaysirRiba v
The current market
or new opportunities in Islamic insurance
The contrasts and synergies
In Wakalah insurance model from a fixed percentage of contributions to the guaranteed income while promoting efficient Mudharabah subscription model and investment for the production of the reserves, of which the insurer per share. There is also a hybrid model that combines the principles of both Al and Al-Mudharabah Wakalah models. In this case, the agent receives the takaful intermediaries as a percentage of contributions of policyholders in the form of fees paid Wakalah and some of the benefits of the investment of the takaful funds generated. In the Waqf model, agents make an initial contribution to a fund of waqf. An additional contribution of the insured collected help fund to meet contingencies. Here also is funding the agent receives a commission Wakalah and the excess money after the settlement of all outstanding amounts distributed to policyholders. The implementation of takaful models differ from the company and the markets, the main reason for this is that Sharia law a policy for how they conducted the business of insurance, in contrast to stenosis is available. The interpretation of sharia may vary slightly depending on the views and beliefs of the Sharia Supervisory Board.or reinsurance Re-Takaful or Islamic model
Reinsurance activities takaful Islamic principles known as retakaful. Due to the acute shortage of retakaful insurers in the market, for now, so Sharia scholars reassure existing operators with traditional principles. Takaful companies to actively promote co-insurance to its competitors, to complement their subscription. In addition, the big kick, traditional reinsurance in Islamic countries.Current Trends and Future Prospects
With population growth in Islamic countries and Islamic world's population believes that the prospect of an Islamic insurance model that promise. 2007-2008, the emerging markets contributed almost 28% of global economic activities. Islamic countries on their own 23% of GDP in emerging markets and 11% of premiums written in these economies (Source: Sigma No. 5/2008, Swiss Re). The amount of the premiums of Takaful emerging markets totaled $ 1.7 billion, with Malaysia and Saudi Arabia with the highest rates of growth. However, other insurance companies operating in the hybrid, with its basis in sharia for another $ 4 billion in premiums.
At the same time, the proportion of premiums to GDP is compared in Islamic countries, 1.3% of GDP to 2.8% for emerging markets as a whole. Therefore, the possibility that takaful operators in these economies are increasing enormously. Current research indicates that the market is grossly under-supplied growth of 25% (after adjusting for inflation) over the next 3-4 years, with a balanced view of one year to another.
With better living standards and awareness of Takaful, the market expects steady growth in per capita spending on Takaful insurance premiums and also in terms of market share compared to traditional insurance products.Product Portfolio
A broad portfolio of products to market Takaful Takaful companies will be offered and are classified as following
Motor - liability and comprehensive insurance markets for personal and commercial. Other support services offered include road, accident insurance, among others.
Navy-Marine cargo, hull, liabilities and agents
Engineering - Assembly Insurance contractors'all risks, plant and machinery, loss of income and the deterioration of the bearings
Property & Casualty - fire and other risks, ownership of all risks, liability, product liability, professional liability, medical malpractice
Several - the insurance money, deposit insurance, compensation, professional associations, travel insurance, accident
Special lines, including the Notes Manta, Jewellers' Block bankers, directors and officers insurance
Family Takaful
Life and Health - Includes family takaful group (group life), accident and sickness insurance, group health, medical and travel assistanceStrategic Issues and Challenges
With the projected growth as described in previous sections, the experience much more takaful industry change. As with any offer of new products, the success of various factors on which depend the interior and exterior. Below are a number of strategic issues and challenges facing providers with the way the industry is struggling to expand.or standardization
The global takaful industry currently has different operating models, accounting standards and regulatory systems. Bahrain, Malaysia and Pakistan are the only markets that have specific laws or regulations issued Takaful. However, despite the laudable efforts of AAOIFI, the industry still needed to establish a set of global standards of regulation, which will be binding on all operators, with some sites.or distribution problems
The takaful industry is dominated by local suppliers. New entrants should create synergies that can be used to leverage existing distribution channels, alliances and strategic Banc-Takaful between regions. Then, the operator can also increase premiums to improve profitability, a key factor to survive the 'start-up "years.or development of innovative products
The development of attractive and competitive products that meet the diverse needs of customers is a major challenge for Takaful producers. Although Takaful providers to meet a very specific market and underserved at present, still must submit product offerings, creating a sophisticated and innovative than conventional competitors. His ability to analyze the products that set the standard in more present than the conventional design of the insurance of the last test of Takaful as a product will be.o Improve Marketing and Branding Tactics
The current market value of takaful is relatively limited, especially in non-Islamic countries. Analysts have suggested it has a huge potential for Takaful Islamic population and non-Muslims, provides an "ethical" alternative insurance. Experts also suggest that Takaful is a potentially useful mechanism for poverty alleviation. The low insurance penetration in many Islamic countries where takaful operators are expected to be most successful takaful operators indicates that still need to make significant progress in this direction.or raising standards of customer service
As the industry grows and becomes more competitive, won the construction management of clients and developing best practices are increasingly important. At present, the overall level of customer service among takaful providers compared to their average counterparts.Kingdom of Saudi Arabia, Takaful market information
It begins in Saudi Arabia recently introduced Islamic insurance products begins. Second, since the accession to the World Trade Organization in 2006, Saudi Arabia has opened the sector to foreign investment in Takaful, Sharia insurance cooperative. Now a committee of Islamic scholars reviewed each product and the company that SABB Takaful TakafulSABB, people associated with HSBC, are persuading consumers to buy insurance. The demand for Islamic insurance is very lively in ArabGulf, analysts say, especially in Saudi Arabia, the largest economy.
Last year, the emerging insurance industry grew 27 percent to SR10.9bn in premiums last year SR8.6bn in 2007, after the Saudi Arabian Monetary Agency Saudi Monetary Agency Audi, the Central Bank supervision of insurance. Insurance premiums, which represent 44 percent of the market, increased by 57 percent to SR4.1bn. Car insurance, representing 46 percent of the market increased by 23 percent.
According to a report by Swiss Re, world's second largest reinsurer, takaful sector grew at an annual average of 25 percent between 2004 and 2007, adjusted for inflation. The rest of the insurance industry grew just over 10 percent per year during this period.The industry figures, however, are only an estimate last year, said the world U.S. $ 500 billion (Dh1.83 billion) in Islamic banking assets, a fraction of the total. However, Accenture, the international management consulting firm, predicts that the domestic savings of Islam to $ 24 billion per year was 2020.According to figures of 2005 accounted for Arab countries, only 24.7 percent of total Takaful contributions, while the Far East, accounted for 75.1 percent - including Iran.The global market for Shariah insurance, or takaful, has the potential to reach $ 11 billion in 2015, but they need to overcome significant challenges to achieving this goal. The Gulf Cooperation Council (GCC) is a leader in the market for takaful growth. Within the region, Saudi Arabia remains the largest market for takaful. "In recent years, Takaful has grown in profile as an alternative to conventional insurance and transformed itself from a regional to a global industry." Estimates vary, but generally accepted that the takaful industry has grown by 20 percent to 25 percent in recent years. The Golf has always represented about a third of the global Takaful market. "In the short term, the GCC market is an important market for growth and takaful takaful and will continue to grow faster than conventional insurance," said Gul Khan, Global Head of Wealth Management in the Islamic banking arm of HSBC Bank, Amanah.
A report on the insurance industry in emerging economies by Swiss Re in 2008, shows that Muslim countries, representing 23 percent growth in emerging countries, and yet insurance penetration remains comparatively low .
Insurance penetration in Muslim countries is 1.3 percent versus 2.8 percent in emerging markets and developed considerably among economies. A rapidly growing population, young and educated is key to growth.
However, several experts noted the constant threat stunted growth prospects. Lack of awareness of takaful products and lack of relevant skills should be offered within the industry of atonement.
Ernst & Young estimates that the global market for takaful $ 7700000000 in 2012 to reach a more conservative estimate made by other industry professionals at the conference. Saudi Arabia remains the largest market for takaful, with grants totaling $ 1.7 billion in 2007, and the GCC is the largest regional market, followed by Malaysia and Sudan.Challengesor Shariah Compliance
The enforcement of Sharia financial products is essential for the credibility of the products and equipment to insure. It's the end of the day, which is different from traditional Islamic financial products.
We have statistics on the potential of Islamic finance seen. The number of Muslim investors is increasing. Are becoming more sophisticated and demand more from their banks. Investors will seek not only of investment performance or compatibility sharia alone. They are both the implementation of Sharia internal demand and good returns.
In fact, with the label "Islamic" or "sharia compliant 'might suggest that the product on the principles of Sharia. Any violation of this rule would be a loss of confidence in the product, company or even the system itself Investors vote with their feet. Therefore, in the interests of the industry to ensure that monitoring systems are in well-managed Sharia in Islamic financial institutions.
However, ensuring the effective implementation of Sharia is not a simple matter. There are many issues you face. For example, one of the most important problems of lack of standardization in handling issues Shariah. Lack of standardization can lead to problems such as increased transaction costs, lack of recognition of the rights and issues of market access across borders. You can even hinder the development of the industry.or development of new products
In addition to complying with Islamic law, is another factor that is crucial for the development of the industry constantly innovating and developing new products. Financial markets are increasing in sophistication, the environment is constantly changing and competition is increasing. Muslim investors have a range of products to its desire to diversify their investments to meet your unique individual needs. There have been many discussions about the need to attract Middle Eastern investors in this region. However, we have created for different asset classes of investments in order to attract these investors are.
The sukuk Ijarah, we issued five years ago, remains the Sukuk is only available in Singapore. We hope to continue making its contribution to the creation of new products.or Continuous Improvement
Therefore, there are some very important questions that the Islamic finance industry faces. And two of the most important, as we have seen, in terms of compliance with the Sharia and the development of new products. However, it is encouraging that much is done to address these challenges.
For example, institutions like the Islamic Financial Services Board (IFSB) and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) made great strides in the development of standards, including adherence to the Sharia. I am pleased to note that the Monetary Authority of Singapore is a full member of the IFSB, and participate in some of the draft legislation.o Development of talent
But at the end of the day, in order to meet these challenges and achieve further improvements, we can not escape the fact that we need talented people. Sharia, in particular, should play a greater role. Tables of Islamic law may be necessary to act differently in order to facilitate the innovation process without Islamic principles. They must participate in the development of new products from scratch. We need to integrate considerations of early Islamic law and complete each development or strategy. They should be monitored closely and is working closely with management to provide more innovative offers Sharia-compliant products.
You need to understand the needs of clients to protect their interests and represent them in the management of organizations.
You have to Sharia compliance systems, which are responsible for developing the standards developed by AAOIFI and IFSB. All these procedures should be in order to avoid problems of information asymmetry for transparency and confidence of potential investors.
Ultimately, both customers will benefit as well as Islamic financial institutions. Investors have a range of products to choose from. The institutions will have greater credibility and increased prospects.
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