---
title: "What is Retakaful commission? | IslamicOpenFinance™"
description: "An amount a retakaful or reinsurance provider pays back to the ceding takaful undertaking for its work in placing the business."
url: https://islamicopenfinance.com/glossary/retakaful-commission/
lang: en-GB
source: "IslamicOpenFinance"
---

[Glossary](https://islamicopenfinance.com/glossary/) / [Takaful](https://islamicopenfinance.com/glossary/#takaful)

Takaful

# Retakaful commission

An amount a retakaful or reinsurance provider pays back to the ceding takaful undertaking for its work in placing the business.

A retakaful or reinsurance commission is a percentage of the contributions ceded, paid by the reinsurer to the ceding Islamic insurance company for its efforts in mobilising the reinsured contracts. AAOIFI's Islamic reinsurance standard defines it alongside a profit commission, which rewards good performance on the reinsured risks. Because the cession is made on behalf of the participants' fund, how such commissions are allocated between that fund and the operator is a disclosure and governance question.

## Sources

- [AAOIFI Shari'ah Standards, English edition (full text, PDF): Shari'ah Standard No. 41, Islamic Reinsurance, Appendix C, reinsurance commission](https://aaoifi.com/wp-content/uploads/2017/12/Shariaa-Standards-ENG.pdf)

This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.

## Related terms

[**Retakaful** Takaful for takaful funds: a takaful undertaking cedes part of its risks to a retakaful fund on behalf of its participants.](https://islamicopenfinance.com/glossary/retakaful/) [**Participants' risk fund** The pool of donated contributions from which takaful claims are paid, owned collectively by participants and managed by the operator.](https://islamicopenfinance.com/glossary/participants-risk-fund/) [**Takaful operator** The entity that manages a takaful business on behalf of participants, usually for a fee, a profit share or both.](https://islamicopenfinance.com/glossary/takaful-operator/) [**Wakalah fee (takaful operator)** The fee a takaful operator charges, usually from contributions, for managing the participants' risk fund.](https://islamicopenfinance.com/glossary/takaful-wakalah-fee/)

**Takaful**

1. [Takaful](https://islamicopenfinance.com/glossary/takaful/)
2. [Tabarru](https://islamicopenfinance.com/glossary/tabarru/)
3. [Participants' risk fund](https://islamicopenfinance.com/glossary/participants-risk-fund/)
4. [Participants' investment fund](https://islamicopenfinance.com/glossary/participants-investment-fund/)
5. [Shareholders' fund (takaful)](https://islamicopenfinance.com/glossary/shareholders-fund/)
6. [Takaful operator](https://islamicopenfinance.com/glossary/takaful-operator/)
7. [Wakalah model (takaful)](https://islamicopenfinance.com/glossary/wakalah-model/)
8. [Takaful participant](https://islamicopenfinance.com/glossary/takaful-participant/)

[All 221 terms](https://islamicopenfinance.com/glossary/)