The real competition between conventional insurance and Takaful will be based on better pricing, services and variety of products and not merely the Halal aspect. This was observed by Chief Executive Officer (CEO) of Pak Qatar Family Takaful Pervaiz Ahmed in an interview with Business Recorder.
"We can't attract people to buy our Takaful products merely on the basis of being Halal. In fact, we would have to work hard to provide them matchless services with the added advantage of being Halal that would make them realise the benefits of Takaful," he added.
Explaining the concept of Takaful, he said that it was an alternative Halal way of mitigating the risk. The word "Takaful" came from the Arabic root word Kafala, meaning "guarantee" or taking care of one's needs, he said, adding: 'Takaful is a Shariah compliant arrangement in which individuals in the community jointly guarantee themselves against future losses or damages."
This method of risk mitigation had been used for centuries, albeit under different names, he said, and added: "Prior to the advent of Takaful, as we know it today, the most common has been 'mutual insurance' which, although similar, is not identical.
"Takaful is based on the principle of solidarity, mutual help, brotherhood and co-operation among members of the community," he explained. He said that the key elements of any Takaful arrangement were the participants in the Takaful pool, and the Takaful operator (company). "The Takaful pool is managed in the shape of a Waqf (endowment) by the Takaful operator, which is actually just an operator and carries out its role in the form of a Wakeel (agent)," he said.
"Participants pool their contribution, which are given in the form of donations, into the Waqf from which they may benefit in the event that they suffer a loss. All claims are paid by the Waqf and not the Takaful operator," he said.
Pervaiz said that risk mitigation and financial protection were things, which everybody needed to be concerned about. To effectively carry this out, they needed a tool, which was not only effective in mitigating the risk, but also immaculately serviced, competitively priced, in compliance with our ethical and religious beliefs and, most importantly, better for the individual and the community. That tool was Takaful, he added.
He said that Pak-Qatar Family Takaful would offer products, providing financial protection and long term savings such as death and disability Takaful, health Takaful, education plans, retirement income plans and other savings schemes. "It is run by a strong and professional management team, which is keen to make Takaful a successful concept in Pakistan," he said.
He said that Pak-Qatar Family Takaful Limited was the first dedicated Takaful company, which would provide family and health Takaful products in Pakistan. "Being the first to enter this area, we look on this premier role as a challenge and a great responsibility," Pervaiz added.
He said that Pak-Qatar Family Takaful had all the required elements needed to be able to provide the required products and service to financially protect the community. He said that Pak-Qatar Family Takaful's main sponsor was royal family of Qatar that owned Qatar Islamic Insurance Company, Qatar Islamic Bank and Qatar National Bank. He said that initially the paid-up capital for Pak-Qatar Family Takaful was Rs 500 million.
Pak-Qatar CEO said that Pak-Qatar Family Takaful had made its re-Takaful arrangements with the world-renowned reinsurer/re-Takaful providers. "This allows us to enjoy the expertise of some of the strongest companies in the world," he said. He said: "We look forward to brining high quality Family Takaful products with the highest levels of service to Pakistanis."
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