Dr. Shariq Nisar, Professor at Rizvi Institute of Management Studies and Research (RIMSR), who has earlier worked at the Harvard Law School, USA as Senior Visiting Fellow and is considered an expert in Islamic Finance, while sharing his perspective on “Justification for and Introduction to Takaful,” highlighted the concept of Insurance and Mutual Insurance, Introduction of “Takaful” or Islamic Insurance, criticism, acceptability and future possibilities of Takaful in India. Dr. Shariq was speaking at Forum for Group Discussion on Economic Issues (FGDEI), a joint platform in association with Sahulat Microfinance Society and Radiance Viewsweekly at JIH headquarters in the national capital on 27 April.
Usama Khan, DCEO, Sahulat Micro-finance Society, while introducing the speaker and the FGDEI, said this platform is the brainchild of Dr. Nejatullah Siddiqi (an Islamic Economist, better known for his contribution to Islamic Finance).
After expressing his views on the conventional insurance, Dr Shariq said, “Takaful or Islamic insurance is an alternate form of insurance which works in accordance with Shari’ah. Islamic laws are not against insurance provided it should not be contrary to Islamic ethos and aim of public welfare. Takaful is in accordance with Shari’ah because in most simple terms Shari’ah is mandated to provide benefits for humanity and avoid any loss/risk in human life. The activity carried out under Takaful complies with these principles.”
“Takaful is a method of joint guarantee among a group of members or participants against loss or damage that may be suffered by any one of them. The members of the group by pooling their contributions agree to mutually guarantee the participants against a loss due to a catastrophe or disaster suffered by any one of them. First Model of Takaful was focused on providing services for the people and not for profit earning from the people,” Shariq argued.
During the talk he also shared his experience of all that he is doing to serve the people through Islamic insurance and he is developing a model in Mumbai and would spread it further based on his experience and performance and acceptability of this model.
He also briefed about Wakalah Model (Agency Model), Mudharabah Model (Profit Sharing Model), Mixed Model (Hybrid Model) and Waqf Model (Donor-Beneficiary Model). According to him, under this model Takaful Operator creates a Waqf Fund. Participants contribute their contributions to this Waqf Fund. The Waqf Fund is responsible to help those out in times of their needs. Surplus in Waqf Fund (if any) is distributed among participants at the end of every year. Such a model has been implemented by an organisation called Uplift India.
The concluding remarks and vote of thanks were delivered by Dr. Waquar Anwar, Financial Advisor of Jamaat-e-Islami Hind.