fstep takaful

8/12/2019 FSTEP TAKAFUL

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TAKAFUL & CONVENTIONALTAKAFUL & CONVENTIONAL

INSURANCEINSURANCEA COMPARISONA COMPARISON

BASIC CONCEPTSBASIC CONCEPTS CONVENTIONALCONVENTIONAL Concepts of RisksConcepts of Risks

Risk ManagementRisk Management Insurable RisksInsurable Risks

Concepts of InsuranceConcepts of Insurance

Functions of InsuranceFunctions of Insurance


2/68

HEINRICHHEINRICH TRIANGLETRIANGLE

1

30

300

Major Injury

Minor Injury

Non-InjuryAccidents


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RISK MANAGEMENTRISK MANAGEMENT

Risk Evaluation

Severity Frequency

Risk Control

PhysicalFinancial

RiskIdentification

Retention Transfer Elimination Minimisation


4/68

ISLAMIC PERSPECTIVE ONISLAMIC PERSPECTIVE ON

INSURANCEINSURANCE

Religious rulings and views on insuranceReligious rulings and views on insurance Islam as a way of lifeIslam as a way of life an ADDINan ADDIN

The study ofThe study of

ShariahShariah

AqeedahAqeedah

--FiqhFiqh

--AkhlaqAkhlaq


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DIVISION OF SHARIAHDIVISION OF SHARIAH

Aqeedah Akhlak

EthicalValues

Fiqh

BeliefValues

OperationValues

IBADATMUAMALATMUNAKAHATJINAYATJIHADFARAID


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MUAMALATMan to Man Activities

Risk Management

Insurance

PoliticalActivities

EconomicActivities

SocialActivities


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FOUNDATION OF ISLAMICFOUNDATION OF ISLAMIC

INSURANCEINSURANCE

Historical perspectivesHistorical perspectivesAcceptability of insurance practiceAcceptability of insurance practice

Philosophical of Islamic insurancePhilosophical of Islamic insurance

Governing principles of TakafulGoverning principles of Takaful


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COMPARISONCOMPARISON

CONVENTIONAL AND ISLAMICCONVENTIONAL AND ISLAMICINSURANCEINSURANCE

AlAl GhararGharar

AlAl MaisirMaisir

AlAl ---- RibaRiba


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TYPESTYPES OF TAKAFUL CONTRACTSOF TAKAFUL CONTRACTS

Contribution by participants toContribution by participants to TabarruTabarru Managing of contribution by an OperatorManaging of contribution by an Operatorunder Alunder AlMudharabbahMudharabbah arrangementsarrangements

Appointment of an Intermediary byAppointment of an Intermediary byCompany or Participants under AlCompany or Participants under Al-- WakallaWakalla

arrangements.arrangements.


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TAKAFUL OPERATIONSTAKAFUL OPERATIONS

Regulations and self regulationsRegulations and self regulations Takaful Act 1984Takaful Act 1984

Takaful RegulationsTakaful Regulations Supervision by BNMSupervision by BNM

as Director of Takafulas Director of Takaful

SyariahSyariah Supervisory BoardSupervisory Board


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Takaful CompanyTakaful CompanyMalaysianMalaysian

PracticePractice

The Company Act 1965The Company Act 1965 Licensing issued by BNM under TakafulLicensing issued by BNM under TakafulAct 1984Act 1984

Types of Takaful business defined by theTypes of Takaful business defined by theActAct i.ei.e Family Solidarity Business andFamily Solidarity Business and

General TakafulGeneral Takaful


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CONDUCT OF BUSINESSCONDUCT OF BUSINESS

ShariahShariahss ComplianceCompliance Contract Obligations as per IslamicContract Obligations as per Islamicperspectivesperspectives

Management of ContributionsManagement of Contributions

Surplus and profitsSurplus and profits

Takaful Business EnvironmentTakaful Business Environment


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GLOBAL TAKAFUL INDUSTRYGLOBAL TAKAFUL INDUSTRY

OVERVIEWOVERVIEW

1%

9%

27%

63%

MALAYSIA

ASIA/PACIFIC

EUROPE/USA

GCC

2006 TOTAL TAKAFUL PREMIUMS

USD 1.7 BILLION= 60 Takaful Companiesin 30 countries

GROWING RATE= 15-20% P.A


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G O SGLOBAL TAKAFUL INDUSTRY


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GLOBAL TAKAFUL INDUSTRYGLOBAL TAKAFUL INDUSTRY

OVERVIEWOVERVIEW

2%

27%

31%

***EUROPE,TURKEY,CHINA & USA USD2.3bn

*GCC (KSA USD 900m,UAE USD480m & EGYPT USD 467m

**ASIA PACIFIC USD3.1bn(Malaysia/Indonesia USD1.4bn

2015 FORECAST

TOTAL TAKAFUL PREMIUMS USD7.4BILLION


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TAKAFUL MODELSTAKAFUL MODELS

TAUWTAUW

WUNI orWUNI or

CorporativesCorporatives

WAKALLA or AgencyWAKALLA or Agency

TIJARI or PureTIJARI or Pure MudharrabahMudharrabah andandModifiedModified MudharrabahMudharrabah

MODEL CURRENTLY IN USE


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MODEL CURRENTLY IN USEMODEL CURRENTLY IN USE

PURE COOPERATIVE MODEL

INVESTMENTPROFIT

CONTRIBUTION(PREMIUM)

PARTICIPANTSPECIAL

ACCOUNT

(COMMON)

PARTICIPANTSACCOUNT(PERSONAL)

INVESTMENTPROFIT

ACTUALMANAGEMENT

EXPENSESOPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

100% 100%


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MODELS CURRENTLY IN USE (MODELS CURRENTLY IN USE (contdcontd))

SYARIKAT TAKAFUL FAMILY MODEL - Mudharaba

INVESTMENTPROFIT


PARTICIPANTSPECIAL

ACCOUNT

(COMMON)


INVESTMENTPROFIT

ACTUALMANAGEMENT

EXPENSESOPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

70%

100%

30%

( d)


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SYARIKAT TAKAFUL GROUP and GENERAL MODEL -Modified Mudharaba

INVESTMENTPROFIT


PARTICIPANTSPECIAL

ACCOUNT

(COMMON)

INVESTMENT

PROFIT

ACTUALMANAGEMENT

EXPENSESOPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

50%

50%

50%

50%

(MODELS CURRENTLY IN USE ( dd))


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TAKAFUL NATIONAL FAMILY MODEL Modified Mudharaba

INVESTMENTPROFIT


PARTICIPANTSPECIAL

ACCOUNT

(COMMON)


INVESTMENTPROFIT

ACTUALMANAGEMENT

EXPENSESOPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

80%

80%

20%20%

MODELS CURRENTLY IN USE (MODELS CURRENTLY IN USE ( dtd))


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TAKAFUL NATIONAL GROUP and GENERAL MODEL -Modified Mudharaba

INVESTMENTPROFIT


PARTICIPANTSPECIAL

ACCOUNT

(COMMON)

INVESTMENT

PROFIT

ACTUALMANAGEMENT

EXPENSESOPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

50%

50%

50%

50%

MODELS CURRENTLY IN USE (MODELS CURRENTLY IN USE ( tdtd))


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WAKALA MODEL Agency / Cooperative

INVESTMENTPROFIT


PARTICIPANTSPECIAL

ACCOUNT

(COMMON)


INVESTMENTPROFIT

ACTUAL

MANAGEMENTEXPENSES

OPERATOR

UNDERWRITING

SURPLUS

POLICY BENEFITS

PARTICIPANT

100%

100%

MANAGEMENT

FEE

MODELS CURRENTLY IN USE (MODELS CURRENTLY IN USE ( tdtd))


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UNIT LINKED MODEL

INVESTMENTPROFIT


OPERATOR

POLICY BENEFITS

PARTICIPANT

100%

UNIT LINKEDFUND

UNIT LINKEDCHARGES

ACTUAL MANAGEMENTEXPENSES

Wh t T k f l M d l?What Takaful Model?


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What Takaful Model?What Takaful Model?

- Takaful Ikhlas Wakalah model

INVESTMENTPROFIT

Participants Investment AccountOr PRIA or GRIA

OPERATOR

POLICY BENEFITS

PARTICIPANT

X%

Taawani Account pool-Expense Fund

-Risk Fund-Special Fund

Contribution (Premium)

INVESTMENTPROFIT

U/writingSurplus

100-Y%

Y%

Wakalah Fee

Monthly Drips

Management FeeInvestment Fee

Tabaruat


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MARKETING ISSUES OFMARKETING ISSUES OF

INTERMEDIARYINTERMEDIARY

Appointment of AgentsAppointment of Agents

Appointment of Brokers as per Section 36Appointment of Brokers as per Section 36(1) Takaful Act 1984(1) Takaful Act 1984

Remunerations of intermediaryRemunerations of intermediarysourcessourcesof fundof fund


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BUSINESS PROCESSESBUSINESS PROCESSES

Selection of RisksSelection of Risks

Completion of proposal formCompletion of proposal form

UnderwritingUnderwriting

Issuance of Takaful CertificateIssuance of Takaful Certificate

Takaful ContributionTakaful Contribution

Claims ProcedureClaims Procedure

Takaful PrinciplesTakaful Principles


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HISTORICAL DEVELOPMENTHISTORICAL DEVELOPMENT Malaysian HistoryMalaysian History

VissionsVissions and Objectivesand Objectives

BNMBNMS RecommendationsS Recommendations

Implementation of Master Plan for IslamicImplementation of Master Plan for IslamicBanking and TakafulBanking and Takaful

TAKAFUL TERMINOLOGIES ASTAKAFUL TERMINOLOGIES AS


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TAKAFUL TERMINOLOGIES ASTAKAFUL TERMINOLOGIES AS

COMPARED TOCOMPARED TOCONVENTIONALCONVENTIONAL TakafulTakaful

MudharabbahMudharabbah MudharibMudharib TabarukTabaruk

WakallaWakalla TawTawwunniwunni TawTawwunnwunn PurePure MudharrabbahMudharrabbah ModifiedModified MudharabbahMudharabbah TijariTijari SahabSahab--maalmaal

ShariahShariah


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TAKAFUL TerminologiesTAKAFUL Terminologies -- contcont AqadAqad IjabIjab

QabulQabul AqeedahAqeedah

AkhlaqAkhlaq

MuammalatMuammalat MunnakahatMunnakahat JinnayatJinnayat

FaraFaraidid The Holy QuranThe Holy Quran AlAlSunnahSunnah/ Al/ Al HadithHadith


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TAKAFUL TerminologiesTAKAFUL Terminologies --contcont ItjmaItjmass

UlamaksUlamaks FatwaFatwa Fatwa CouncilFatwa Council

FardhuFardhuAinAin FardhuFardhu KiffayahKiffayah FiqhFiqh FardhuFardhu oror WajibWajib SabrSabr SodaqahSodaqah BarakahBarakah


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TAKAFUL TerminologiesTAKAFUL Terminologies --contcont MandubMandub oror SunnatSunnat

JaizJaiz oror HarusHarus MakruhMakruh HaramHaram

HalalHalal SahihSahih FasidFasid BatilBatil QadhaQadha QadharQadhar DharurratDharurrat


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TAKAFULTAKAFUL i t i l ii t i l i


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TAKAFULTAKAFUL-- insurance terminologiesinsurance terminologies

--contcont

MudharabbahMudharabbah

TabarrukTabarruk

ShariahShariah ComplianceCompliance

Co TakafulCo Takaful Re TakafulRe Takaful

BancaBanca TakafulTakaful AqadAqad

MTAMTA

Th M l i T k f l I d tTh M l i T k f l I d t


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The Malaysian Takaful IndustryThe Malaysian Takaful Industry

OperatorsOperators

Investors/Investors/

shareholdersshareholders

GovernmentGovernment

/regulator/regulator

ProductsProducts

--Sole composite operatorSole composite operatorwith RM10 million capital.with RM10 million capital.

--An Islamic bank and stateAn Islamic bank and state

religious councils andreligious councils and

foundations.foundations.

--Setting the foundation forSetting the foundation for

the instruction ofthe instruction of takafultakaful byby

providing basic regulation.providing basic regulation.

--Limited products mainlyLimited products mainly

confined to motor, fire andconfined to motor, fire and

mortgagemortgage takafultakaful..

--Five composite operatorsFive composite operatorswith minimum capital ofwith minimum capital of

RM100 million each.RM100 million each.

--Broad range of investorsBroad range of investorscomprising privatecomprising private

investors, banking groups,investors, banking groups,

insurers, and ainsurers, and a reinsurerreinsurer..

--Providing enablingProviding enabling

environment for theenvironment for the

development industry anddevelopment industry and

setting strategic direction insetting strategic direction inthe medium and longthe medium and long--term.term.

--Broad range of product mixBroad range of product mix

withwith sophiticatedsophiticated features.features.

19841984 20052005

CustomersCustomers --Mainly MuslimsMainly Muslims Muslims and nonMuslims and non MuslimsMuslims


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CustomersCustomers

DistributionDistribution

channelschannels

InvestmentInvestment

avenuesavenues

--Mainly Muslims.Mainly Muslims.

--Branches and marketingBranches and marketingofficers.officers.

--Confined to IslamicConfined to Islamicdeposits and Governmentdeposits and GovernmentIslamic securities.Islamic securities.

--Muslims and nonMuslims and non--MuslimsMuslims

withdifferentwithdifferent expectations,expectations,

preferences and demands.preferences and demands.

--Branches, marketingBranches, marketing

officers, agency, force,officers, agency, force,

bancatakafulbancatakaful, brokers,, brokers,internet and strategicinternet and strategic

alliances.alliances.

--Wider range ofWider range of

investmentinstrumentsinvestmentinstruments

issued by the Governmentissued by the Government

and the private sectors.and the private sectors.


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FUNDAMENTALS OFFUNDAMENTALS OF

CORPORATE RISK SCORECARDCORPORATE RISK SCORECARDMISSION

VISION

GOALS & STRATEGICOBJECTIVES

CORPORATE GOVERNANCE

FINANCIAL

CUSTOMERProducts & Services / Suppliers

OPERATIONAL HUMAN CAPITAL

EXTERNALEXTERNAL

REGULATORYREGULATORY

LEGALLEGAL

EXTERNALEXTERNAL

REGULATORYREGULATORY

LEGALLEGAL

PRESENTATION OF RELATIONSHIP CHAIN IN APRESENTATION OF RELATIONSHIP CHAIN IN A


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PARTICIPANTSPARTICIPANTS

ANN GENERALANN GENERAL

MEETINGMEETING

BOARD MEMBERSBOARD MEMBERSAUDIT COMMITEEAUDIT COMMITEE

SYARIAH SUPERVISIORY BOARDSYARIAH SUPERVISIORY BOARD

CONSUMERSCONSUMERS

LEGAL SUPERVISIORYLEGAL SUPERVISIORY

AUTHORITYAUTHORITY

APPROVEDAPPROVED

ACTUARYACTUARY

PRESENTATION OF RELATIONSHIP CHAIN IN APRESENTATION OF RELATIONSHIP CHAIN IN A

TAKAFUL OPERATIONS ENVIRONMENTSTAKAFUL OPERATIONS ENVIRONMENTS

COMMON MISCONCEPTIONSCOMMON MISCONCEPTIONS


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ON TAKAFULON TAKAFUL

Risk Protection (insurance ) is againstRisk Protection (insurance ) is against TawkkulTawkkulieie total dependence upon Allah (total dependence upon Allah (swtswt ))

All Risk Protection (insurance ) isAll Risk Protection (insurance ) is HaramHaramprohibitedprohibited

All Insurance is a form of Gambling orAll Insurance is a form of Gambling orWagering , which is forbidden in IslamWagering , which is forbidden in Islam

All Insurance seeks toAll Insurance seeks to maximisemaximise profits whichprofits whichtakes benefits away from Policyholderstakes benefits away from Policyholders



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COMMON MISCONCEPTIONSCOMMON MISCONCEPTIONS--

contcont5. All Takaful operators are the same5. All Takaful operators are the same

6. I do not need Takaful6. I do not need Takaful

TAKAFUL MODEL (MalaysianTAKAFUL MODEL (Malaysian


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TAKAFUL MODEL (MalaysianTAKAFUL MODEL (Malaysian

Practice)Practice)

Takaful MalaysiaTakaful Malaysia

TakafulTakaful NasionalNasional

MaybanMayban TakafulTakaful

TakafulTakaful IkhlasIkhlas


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Corporate InformationCorporate InformationSyarikat TakafulSyarikat Takaful

MalaysiaMalaysia BerhadBerhad

FY endedFY ended30.06.200430.06.2004

TakafulTakaful NasionalNasional

Sdn BhdSdn Bhd

FY endedFY ended31.03.200531.03.2005

MaybanMayban TakafulTakaful

BerhadBerhad

FY endedFY ended30.06.200430.06.2004

TakafulTakaful IkhlasIkhlas SdnSdn

BhdBhd

29 Nov 198429 Nov 1984 7 June 19937 June 1993 31 Dec 200131 Dec 2001 18 Sept 200218 Sept 2002

IncorporationIncorporation Started operationStarted operationon 1 July 2002on 1 July 2002 Started operationStarted operationon 2 July 2003on 2 July 2003

Listed on KLSEListed on KLSE

since 31 July 1996since 31 July 1996A subsidiary ofA subsidiary of

MalaysianMalaysian

NationalNational

Insurance (MNI)Insurance (MNI)

A whollyA wholly--ownedowned

subsidiary ofsubsidiary of

MaybanMayban FortisFortis

HoldingsHoldings BerhadBerhad

A subsidiary ofA subsidiary of

Malaysia NationalMalaysia National

Reinsurance BhdReinsurance Bhd

Authorized CapitalAuthorized Capital RM 500,000,000.00RM 500,000,000.00 RM 500,000,000.00RM 500,000,000.00 RM 35,000,000.00RM 35,000,000.00 RM 100,000,000.00RM 100,000,000.00

PaidPaid--up Capitalup Capital RM 143,000,000.00RM 143,000,000.00 RM 100,000,000.00RM 100,000,000.00 RM 35,000,000.00RM 35,000,000.00 RM 100,000,000.00RM 100,000,000.00

Total Net AssetTotal Net Asset RM 2,091,939,233.00RM 2,091,939,233.00 RM 2,475,779,000.00RM 2,475,779,000.00 RM 82,680,538.00RM 82,680,538.00 RM 78 million (unRM 78 million (un

audited)audited)


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Elements of Takaful ModelElements of Takaful Model

Cooperative riskCooperative risk--sharing for protection amongstsharing for protection amongst

participantsparticipants Clear segregation of roles for participants and operatorsClear segregation of roles for participants and operators IncorporatesIncorporates tabarrutabarru concept to eliminateconcept to eliminate gharargharar

AvoidsAvoids ribariba andand maisirmaisir All transactional aspects; i.e. investment, etc; are inAll transactional aspects; i.e. investment, etc; are incompliance tocompliance to ShariahShariah LawLaw

Appointment ofAppointment of ShariahShariahAdvisory Council as advisorsAdvisory Council as advisors


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FAMILY TAKAFUL MODELFAMILY TAKAFUL MODEL

Family Takaful Model (LifeFamily Takaful Model (Life


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Insurance)Insurance) Takaful MalaysiaTakaful Malaysia

Companys Administration &

Management Expenses

Profits Attributable

to Shareholders

Profit fromInvestment

Investmentby Company

Tak

afulContributio

n

Fam

ilyTakafulFun

d

ParticipantsAccount

Participants

SpecialAccount

ParticipantsAccount

Participants

SpecialAccount

ParticipantsAccount

Takaful

Benefit

Payment toParticipant

Payment to

Participant

Com

pany

Takaful Contract based onPrinciple of Al-Mudharabah

P

articipant

30%

70%



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Insurance)Insurance) Takaful MalaysiaTakaful Malaysia Participant paysParticipant pays takafultakaful installments to STMB for taking up theinstallments to STMB for taking up the

Family PlanFamily Plan

The installments are credited to the Family Takaful Fund:The installments are credited to the Family Takaful Fund: ParticipantParticipants Account (PA) for saving and investment purposess Account (PA) for saving and investment purposes

PartcipantsPartcipantsss Special Account (PSA) asSpecial Account (PSA) as tabarrutabarru

The contribution is invested in a manner deemed fit by the STMBThe contribution is invested in a manner deemed fit by the STMB inin

compliance tocompliance to ShariahShariah Profit from investment is subjected to profitProfit from investment is subjected to profit--sharing under thesharing under the

mudharabahmudharabah contract between the participant and STMB:contract between the participant and STMB: The sharing is at the gross profit before deducting the CompanyThe sharing is at the gross profit before deducting the Companyss

management expensesmanagement expenses

Sharing ratio of 70:30 for participants and company respectivelySharing ratio of 70:30 for participants and company respectively

Commission and management expenses is borne by STMB from itsCommission and management expenses is borne by STMB from itsshare of investment profitshare of investment profit

Income to the Shareholders would be the surplus of investmentIncome to the Shareholders would be the surplus of investment

profit after deducting all expensesprofit after deducting all expenses



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Insurance)Insurance) Takaful MalaysiaTakaful MalaysiaContributionContribution 100,000.00100,000.00

InvestmentInvestment 8,000.008,000.00 Contribution isContribution is

invested with 8%invested with 8%returnsreturns

(8% returns)(8% returns)

PSA (10%)PSA (10%) PA (90%)PA (90%) TAKAFUL MALAYSIATAKAFUL MALAYSIA

10,000.0010,000.00 90,000.0090,000.00

Allocation of returnsAllocation of returns5,600.005,600.00

2,400.002,400.00 Investment returns isInvestment returns is

shared at 70:30 ratioshared at 70:30 ratio

560.00560.00 5,040.005,040.00 ParticipantParticipants share ofs share of

investment returns isinvestment returns is

split 10:90 forsplit 10:90 for

PSA:PAPSA:PA

Total fundTotal fund 10,560.0010,560.00 95,040.0095,040.00 2,400.002,400.00

Mgmt ExpensesMgmt ExpensesThe ME &The ME &Commission areCommission are

chargedcharged STMBSTMBss

portion of incomeportion of income

UnderwritingUnderwriting (8,000.00)(8,000.00) (10,000.00)(10,000.00)

CommissionCommission

(15,000.00)(15,000.00)

SurplusSurplus 2,560.002,560.00 95,040.0095,040.00 (17,600.00)(17,600.00)

97,600.0097,600.00 (17,600.00)(17,600.00)



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Insurance)Insurance) TakafulTakaful NasionalNasionalParticipantsContributions

ParticipantsAccount

ParticipantsSpecial Acc

ManagementExpenses

Risk Fund Commission

Investment

Participant Shareholders

Investment


80% 20% 80% 20%



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Insurance)Insurance) TakafulTakaful NasionalNasional Participant paysParticipant pays takafultakaful contributions to TNSB for taking up thecontributions to TNSB for taking up the

Family PlanFamily Plan

The contribution is credited to the Family Takaful Fund:The contribution is credited to the Family Takaful Fund: ParticipantParticipants Account (PA) for savings and investment purposes Account (PA) for savings and investment purpose

ParticipantParticipants Special Account (PSA) ass Special Account (PSA) as tabarrutabarru

The contribution is invested in a manner deemed fit by the TNSBThe contribution is invested in a manner deemed fit by the TNSB inin

compliance tocompliance to ShariahShariah Profit from investment is put back into ParticipantProfit from investment is put back into Participants PA & PSA ats PA & PSA at

70:30 ratio respectively70:30 ratio respectively

The investment profit in PA is shared between Participant & TNSBThe investment profit in PA is shared between Participant & TNSB atat

70:30 ratio respectively70:30 ratio respectively

Commission & management expenses is charged to the PSACommission & management expenses is charged to the PSA The surplus in PSA is shared between Participants & TNSB at 80:2The surplus in PSA is shared between Participants & TNSB at 80:200

ratio respectivelyratio respectively

Income to Shareholders would beIncome to Shareholders would be TNSBTNSBss share of investment profitshare of investment profitin PA and share of surplus in PSA after deducting all expensesin PA and share of surplus in PSA after deducting all expenses



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Insurance)Insurance) TakafulTakaful NasionalNasionalContributionContribution 100,000.00100,000.00

Investment (8%Investment (8% retunsretuns)) 8,000.008,000.00 Contribution isContribution is

invested with 8%invested with 8%

returnsreturnsPSA (70%)PSA (70%) PA (30%)PA (30%) TakafulTakaful NasionalNasional

70,000.0070,000.00 30,000.0030,000.00

Allocation of returnsAllocation of returns 5,600.005,600.00 2,400.002,400.00 Investment returns isInvestment returns is

put back intoput back into

ParticipantParticipants PSA &s PSA &

PA at 70:30 ratioPA at 70:30 ratio

1,920.001,920.00 480.00480.00

Total fundTotal fund 75,600.0075,600.00 The amount in PA isThe amount in PA is

split on 80:20 ratiosplit on 80:20 ratio

between Participantbetween Participant

& TN& TN

UnderwritingUnderwriting (8,000.00)(8,000.00)

Mgmt ExpensesMgmt Expenses (10,000.00)(10,000.00)

CommissionCommission (15,000.00)(15,000.00)

SurplusSurplus 42,600.0042,600.00 31,920.0031,920.00

The surplus in PSA isThe surplus in PSA issplit at 80:20 ratiosplit at 80:20 ratio

between Participantbetween Participant

& TN& TN

34,080.0034,080.00 8,520.008,520.00

66,000.0066,000.00 9,000.009,000.00



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Insurance)Insurance) TakafulTakaful IkhlasIkhlasParticipantsContribution

IKHLAS

Personal

InvestmentAccount (PIA)

Personal Risk

Investment Account(PRIA)

Taawuni AccountPool (TAP)

Profit(if any)

Surplus

(if any)

Profit(if any)

InvestmentFunds

InvestmentFunds

Ikhlas will charge a surplusadmin fee

Risk & Investment Only Products Risk Only Products

Front-end Front-end

BalanceBalance

Ikhlas will charge a performance fee Ikhlas will charge a performance fee



53/68


Insurance)Insurance) TakafulTakaful IkhlasIkhlas All contributions paid by Participants shall be allocated to PerAll contributions paid by Participants shall be allocated to Personal Risksonal Risk

Investment Account (PRIA) and Personal Investment Account (PIA)Investment Account (PRIA) and Personal Investment Account (PIA) at aat a

ratio based on the various products offeredratio based on the various products offered PRIA Account is for protection whilst PIA is for protection & inPRIA Account is for protection whilst PIA is for protection & investmentvestment TISB charges 20%TISB charges 20% WakalahWakalah Fee for managing the Family Fund (% chargedFee for managing the Family Fund (% charged

varied for different products)varied for different products)

Part of the contributions in PRIA & PIA is put into TAP that hasPart of the contributions in PRIA & PIA is put into TAP that has frontfront--&&--backback--end charges as allocations for benefits/reserves, claims, servicend charges as allocations for benefits/reserves, claims, servicing,ing,management expenses & commission (Expense Fund, Risk Fund & Specmanagement expenses & commission (Expense Fund, Risk Fund & SpecialialFund)Fund)

Any surplus in TAP is put back into respective PRIA & PIAAny surplus in TAP is put back into respective PRIA & PIA TISB charges a 10% Surplus Administration Fee for this activityTISB charges a 10% Surplus Administration Fee for this activity

The balance is put back into PRIA & PIA respectivelyThe balance is put back into PRIA & PIA respectively Profit received from investment activities is returned to PRIA &Profit received from investment activities is returned to PRIA & PIA afterPIA after

deducting Investment Performance Fee of 10%deducting Investment Performance Fee of 10%

The net surplus shall be shared at a ratio of 50:50 or better beThe net surplus shall be shared at a ratio of 50:50 or better betweentweenParticipant and TISBParticipant and TISB



54/68

Family Takaful Model (Lifey (

Insurance)Insurance) TakafulTakaful IkhlasIkhlasContributionContribution 100,000.00100,000.00Investment (8% returns)Investment (8% returns) 8,000.008,000.00

7,200.007,200.00 800.00800.00 Contribution is investedContribution is invested

with 8% returnswith 8% returnsParticipantParticipants shares share 10% Performance Fee10% Performance Fee

PIA (10%)PIA (10%) PRIA (90%)PRIA (90%) TAKAFUL IKHLASTAKAFUL IKHLAS

WakalahWakalah feefee 20,000.0020,000.00 20%20% WakalahWakalah Fee isFee is

charged to participantcharged to participantss

contriutioncontriutionNet contribution afterNet contribution after

wakalahwakalah80,000.0080,000.00

8,000.008,000.00 72,000.0072,000.00 10% Performance Fee10% Performance Fee

Allocation of investmentAllocation of investment

returnreturn7,200.007,200.00 800.00800.00 10% Performance Fee is10% Performance Fee is

charged at profit receivedcharged at profit received

from investment activityfrom investment activity720.00720.00 6,480.006,480.00

Gross surplusGross surplus 8,720.008,720.00 78,480.0078,480.00 20,800.0020,800.00

UnderwritingUnderwriting

(8,000.00)(8,000.00)

Mgmt ExpensesMgmt Expenses

(10,000.00)(10,000.00)


(15,000.00)(15,000.00)

SurplusSurplus 8,720.008,720.00 45,480.0045,480.00

54,200.0054,200.00 10% Surplus Admin Fee10% Surplus Admin Fee

5,420.005,420.00 10% Surplus Admin Fee is10% Surplus Admin Fee is

charged on the activitycharged on the activity

27,100.0027,100.00 27,100.0027,100.00 The surplus is sharedThe surplus is shared

between participant &between participant &

TISB at 50:50 ratioTISB at 50:50 ratio2,710.002,710.00 24,390.0024,390.00

27,100.0027,100.00 53,320.0053,320.00


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GENERAL TAKAFUL MODELGENERAL TAKAFUL MODEL

General Takaful ModelGeneral Takaful Model TakafulTakaful


56/68

MalaysiaMalaysia

Companys Administration &Management Expenses

Profits Attributableto Shareholders

Profit fromInvestment

Investmentby Company

TakafulInstallments

Paid byParticipants

Com

pany

Takaful Contract based on

Principle of Al-Mudharabah

Participant

GeneralTakafulFund

GeneralTakafulFund

OperationalCost ofTakaful

Surplus(Profit)

Share ofSurplus for

theParticipants

Share of Surplus

for the Company

50%

50%



57/68

MalaysiaMalaysia Participants payParticipants pay takafultakaful installment to STMB for taking up theinstallment to STMB for taking up the

General PlanGeneral Plan

The installments is credited to the General Takaful Fund asThe installments is credited to the General Takaful Fund as tabarrutabarruin the Participantin the Participants Special Account (PSA)s Special Account (PSA)

The contribution is invested in a manner deemed fit by the STMBThe contribution is invested in a manner deemed fit by the STMB inincompliance tocompliance to ShariahShariah

The profit from investment is put back into the FundThe profit from investment is put back into the Fund The surplus is subjected to profitThe surplus is subjected to profit--sharing under thesharing under the mudharabahmudharabahcontract between the participant and STMB:contract between the participant and STMB: Sharing ratio of 50:50 for participants and company respectivelySharing ratio of 50:50 for participants and company respectively

Commission & management expenses is borne by STMB from itsCommission & management expenses is borne by STMB from itsshare of the surplusshare of the surplus Income to the Shareholders would be the surplus of investmentIncome to the Shareholders would be the surplus of investment

profit after deducting all expensesprofit after deducting all expenses



58/68

MalaysiaMalaysiaPSAPSA TAKAFUL MALAYSIATAKAFUL MALAYSIA

ContributionContribution 100,000.00100,000.00

Investment (8% returns)Investment (8% returns) 8,000.008,000.00 Contribution is investedContribution is invested

with 8% returnswith 8% returnsTotal fundTotal fund 108,000.00108,000.00


SurplusSurplus 43,000.0043,000.00

21,500.0021,500.00 21,500.0021,500.00 The surplus is sharedThe surplus is shared

betweenbetween

Participant:STMBParticipant:STMB atat

50:50 ratio50:50 ratio

Mgmt ExpensesMgmt Expenses

(10,000.00)(10,000.00)


(10,000.00)(10,000.00)

21,500.0021,500.00 1,500.001,500.00



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NasionalNasionalParticipantsContributions

Takaful Fund

Management

Expenses Risk Fund Commission

Surplus


50% 50%

Investment



60/68

NasionalNasional Participants payParticipants pay takafultakaful installments to TNSB for takinginstallments to TNSB for taking

up the General Planup the General Plan

The installments is credited to the General Takaful FundThe installments is credited to the General Takaful Fundasas tabarrutabarru in the Participantin the Participants Special Account (PSA)s Special Account (PSA)

The contribution is invested in a manner deemed fit byThe contribution is invested in a manner deemed fit by

the TNSB in compliance withthe TNSB in compliance with ShariahShariah The profit from investment is put back into the FundThe profit from investment is put back into the Fund Commission & management expenses is borne by PSACommission & management expenses is borne by PSA The surplus is subjected to profitThe surplus is subjected to profit--sharing under thesharing under the

mudharabahmudharabah contract between the participant andcontract between the participant andSTMB:STMB: Sharing ratio of 50:50 for participants and company respectivelySharing ratio of 50:50 for participants and company respectively

Income to the Shareholders would beIncome to the Shareholders would be TNSBTNSBss share ofshare ofthe surplusthe surplus

General Takaful ModelGeneral Takaful Model MaybanMayban


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TakafulTakaful Participant

TakafulContribution

Commission

to Agent

GeneralTakafulFund

Wakalah Fee

(20% ofcontribution)

Management

Expenses

Investment

Surplus

Allowedexpenses:Underwriting

Claim reserves& provisionsReserves

Less:

20% share of surplus

80% as performance fee

General Takaful ModelGeneral Takaful Model MaybanMayban


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TakafulTakaful Participants pay contribution for taking upParticipants pay contribution for taking up MTSMTSss General productGeneral product The contribution forms aThe contribution forms a tabarrutabarru in the General Fundin the General Fund MTB charges 20%MTB charges 20% WakalahWakalah Fee for managing the FundFee for managing the Fund The Fund is invested in accordance toThe Fund is invested in accordance to SyariahSyariah principleprinciple Proceeds from investment is put back into the FundProceeds from investment is put back into the Fund MTB bears the cost for management expenses & commissionMTB bears the cost for management expenses & commission Underwriting is charged to theUnderwriting is charged to the tabarrutabarru accountaccount The surplus after deduction for Underwriting is shared at 20:80The surplus after deduction for Underwriting is shared at 20:80 ratioratio

between participants & MTB respectivelybetween participants & MTB respectively

The 20% share of the surplus attributable to participants will bThe 20% share of the surplus attributable to participants will beereturned to the Fundreturned to the Fund

In the event of insufficient amount in the Fund to meet itsIn the event of insufficient amount in the Fund to meet itsobligation, MTB provides interestobligation, MTB provides interest--free loan to be refree loan to be re--paid by thepaid by theFund from future surplusesFund from future surpluses

General TakafulGeneral Takaful TakafulTakaful NasionalNasional


63/68

General TakafulGeneral Takaful TakafulTakaful NasionalNasional

PSAPSA TakafulTakaful NasionalNasional

ContributionContribution 100,000.00100,000.00 Contribution is investedContribution is invested

with 8% returnswith 8% returnsInvestment (8% returns)Investment (8% returns) 8,000.008,000.00

Surplus after investmentSurplus after investment 108,000.00108,000.00

CommissionCommission (10,000.00)(10,000.00)

Mgmt ExpensesMgmt Expenses (10,000.00)(10,000.00)


Net SurplusNet Surplus 23,000.0023,000.00

11,500.0011,500.00 11,500.0011,500.00 The surplus in PSA isThe surplus in PSA is

split at 50:50 ratiosplit at 50:50 ratio

between Participant &between Participant &

TNTN

11,500.0011,500.00 11,500.0011,500.00

General TakafulGeneral Takaful MaybanMayban TakafulTakaful


64/68

General TakafulGeneral Takaful MaybanMayban TakafulTakafulContributionContribution 100,000.00100,000.00

Invested with 8% returnsInvested with 8% returns 8,000.008,000.00 Contribution is investedContribution is invested

with 8% returnswith 8% returnsPSAPSA MaybanMayban TakafulTakaful

WakalahWakalah FeeFee 20,000.0020,000.00 WakalahWakalah fee is chargedfee is chargedat 20% fromat 20% from

contributioncontributionBalance afterBalance after wakalahwakalah chargecharge 80,000.0080,000.00

InvestmentInvestment 8,000.008,000.00

Surplus after investmentSurplus after investment 88,000.0088,000.00 Mgmt ExpensesMgmt Expenses

UnderwritingUnderwriting (65,000.00)(65,000.00) (10,000.00)(10,000.00)CommissionCommission

(10,000.00)(10,000.00)

SurplusSurplus 23,000.0023,000.00

4,600.004,600.00 18,400.0018,400.00 The surplus would beThe surplus would be

split at 20:80 rationsplit at 20:80 ration

between Participant &between Participant &

MTBMTB

4,600.004,600.00 18,400.0018,400.00



65/68

IkhlasIkhlasParticipantsContribution

IKHLAS

General Risk

InvestmentAccount (GRIA)

Taawuni Account Pool(TAP)

Profit(if any)

Profit(if any)

InvestmentFunds

Front-end charges

Balance

Ikhlas will charge a performance fee Ikhlas will charge a surplus admin fee



66/68

IkhlasIkhlas All contributions paid by Participants is put back into GeneralAll contributions paid by Participants is put back into General RiskRisk

Investment Account (GRIA)Investment Account (GRIA)

TISB charges 20%TISB charges 20% WakalahWakalah Fee for managing the General FundFee for managing the General Fund Part of the contributions in GRIA is put into TAP that has frontPart of the contributions in GRIA is put into TAP that has front--&&--

backback--end charges as allocations for benefits/reserves, claims,end charges as allocations for benefits/reserves, claims,servicing, management expenses & commission (Expense Fund, Riskservicing, management expenses & commission (Expense Fund, Risk

Fund & Special Fund)Fund & Special Fund)

Any surpluses in TAP is put back into GRIAAny surpluses in TAP is put back into GRIA TISB charges a 10% Surplus Administration Fee for this activityTISB charges a 10% Surplus Administration Fee for this activity The balance is put back into GRIAThe balance is put back into GRIA

Profit received from investment activities is returned to GRIA aProfit received from investment activities is returned to GRIA afterfterdeducting Investment Performance Fee of 10%deducting Investment Performance Fee of 10% The net surplus shall be shared at a ratio of 70:30 or betterThe net surplus shall be shared at a ratio of 70:30 or better

between Participant and TISBbetween Participant and TISB


67/68

ENDEND


68/68

ENDEND

ALLHAMDULLILAHALLHAMDULLILAH

Thank YouThank You

MOHD SHUKRI SALLEHMOHD SHUKRI SALLEH

012012--77664897766489

[email protected][email protected]

fstep takaful

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