Contribution split
Each contribution is split between the participants' risk fund and the operator's fee as the certificate provides.
Markets
Takaful and retakaful
Participants share risk through a fund the operator manages but does not own.
In takaful, participants contribute to a risk fund that pays claims, while the operator earns a wakalah fee or a mudarabah share for managing it. The fund, the operator's shareholders' fund and any surplus must be kept apart, as IFSB standards on takaful describe. IslamicOpenFinance™ separates those funds in the model and in every event.
Financial products
What you build on IslamicOpenFinance™
Claims from the risk fund
Approved claims are paid from the participants' risk fund and recorded against it.
Surplus handling
Underwriting surplus is determined and distributed or retained as the approved model states.
Qard from the operator
If the risk fund is in deficit, a qard from the operator is recorded and tracked for repayment.
Retakaful cession
Risks ceded to retakaful operators are recorded with their recoveries.
Value chain
The actors in this chain
IslamicOpenFinance™ connects them with one contract model, one policy and one evidence trail.
ParticipantTakaful operatorParticipants' risk fundRetakaful operatorSurveyorInsurance regulatorShariah committee
Typical flow
A typical flow, step by step
- Quote
- Contribution
- Split to risk fund and fee
- Certificate
- Claim
- Payment from the fund
- Surplus
Live demo
See it in the terminal
Omar's motor claim with Hisn Takaful (demo) paid from the participants' risk fund, not from the operator's funds. Demo data
DemoAll institutions, people, amounts and events are fictional demonstration data. Nothing here is a Shariah ruling, an offer or advice; approving a product is for each institution's own Shariah board and regulator.
Glossary