---
title: "What is Retakaful? | IslamicOpenFinance™"
description: "Takaful for takaful funds: a takaful undertaking cedes part of its risks to a retakaful fund on behalf of its participants."
url: https://islamicopenfinance.com/glossary/retakaful/
lang: en-GB
source: "IslamicOpenFinance"
---

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

Takaful

# Retakaful

Takaful for takaful funds: a takaful undertaking cedes part of its risks to a retakaful fund on behalf of its participants.

Retakaful is an arrangement in which a takaful undertaking cedes a portion of its risks, by treaty or on a facultative basis, as a representative of its participants, contributing part of the contribution as tabarru to a common fund that covers specified loss or damage, as IFSB-29 describes it. It plays the role that reinsurance plays for conventional insurers. Where retakaful capacity is limited, some supervisors allow conventional reinsurance under conditions set by Shariah boards.

## Sources

- [IFSB-29 Conduct of Business Supervision for Takaful Undertakings, 2023: Definitions, Retakaful](https://www.ifsb.org/wp-content/uploads/2023/12/IFSB-29-Conduct-of-Business-Supervision-for-Takaful-Undertakings.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

[**Takaful** Mutual cover: participants contribute to a common fund, as donations, to help one another against specified losses.](https://islamicopenfinance.com/glossary/takaful/) [**Tabarru** The donation portion of a takaful contribution, paid into the risk fund to meet claims as mutual help.](https://islamicopenfinance.com/glossary/tabarru/) [**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/)

**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/)