JPWALL is very experienced in Takaful and has been heavily involved in the development of the Takaful industry, in particular with regards to the Takaful Operational Framework and the implementation of the RBC for Takaful Operators in Malaysia.

  • Our Expertise
  • What is Takaful?
  • Comparison with Conventional Insurance

Our Expertise

  1. 1.Statutory Certification
    With the evolving statutory requirements, Takaful operators are faced with an increasing demand from regulators to demonstrate solvency, efficiency, and transparency. We support our clients in the following areas:

    1. Certifying the valuation of liabilities for Risk-based Capital (RBC)
    2. Recommendation of Surplus Distribution
    3. Preparation of Financial Conditional Reports (FCR)
  2. 2.Capital Modelling
    Our experience includes performing Stress Tests for Takaful Operators and building Internal Capital Target (ICT) models for RBC. We are also experienced in building Dynamic Financial Analysis (DFA) models using stochastic simulation techniques to estimate Takaful operator's optimal capital levels.
  3. 3.Contribution Pricing
    We provide actuarial advice on the appropriate level of contribution for both existing and new products using various pricing methodologies with consideration of the type of Takaful model employed.
  4. 4.Risk Management
    We support our clients through both Internal Capital Adequacy Assessment Process (ICAAP) and Own Risk and Solvency Assessment (ORSA).
  5. 5.Mergers and Acquisitions
    With our understanding of the local market, we support on market entry advisory, including studies on strategic feasibility and detailed business plan assessments.

What is Takaful?

Takaful is an Islamic insurance concept observing the rules and regulations of Sharia law. It is a co-operative system amongst participants, guaranteeing each other against risks. Takaful products are gaining popularity due to greater awareness, attractive packages and conformation to Islamic principles.

Comparison with Conventional Insurance

  Takaful Conventional Insurance
Concept Based on mutual cooperation Based on commercial factors
Operation Free from interest, gampling, and uncertainty Includes elements of interest and uncertainty
Governance Subjected to Governing Laws and Sharia Supervisory Board Subjected to Governing Laws only
Surplus Surplus from Takaful Fund is shared among participants of the fund All profits belong to the shareholders of the company
Deficit Takaful Operators provides free interest loan to the Participants Risk Fund Insurance company bears all deficits