Posted by: TheMajlis

‘Takafol’ is Riba Insurance

‘TAKAFOL’ IS CONVENTIONAL riba insurance which is being fallaciously promoted as an acceptable ‘Islamic’ brand of insurance. Proponents and purveyors of this riba insurance disguised very deceptively in the hues of the Shariah’s concept of Waqf, are at pains to convince Muslims that their insurance project is different from the conventional insurance which even they acknowledge is haraam.

The two fundamental constituents which render all insurance haraam are Riba (interest) and Qimaar (gambling). Even after laboriously presenting labyrinthal postulation in the abortive endeavour to accord Shar’i legality to the old wine of insurance marketed in the very same old bottle, albeit with a different label of deception, the votaries of this riba insurance have miserably failed to substantiate their fallacy.

One need not be a scholar or a Molvi to see through the extremely thin veneer coating the insurance product offered under the ‘Takafol’ label. The nature of the prohibition of this insurance is so conspicuous that even ordinary laymen will not be deceived. Even after just a cursory perusal of the ‘Takafol’ insurance agreement, if they are concerned about the Shariah and Allah’s command to abstain from riba and qimaar.

Before anyone ventures into ‘Takafol’ insurance, it is imperative that he studies the agreement which he has to sign. No o­ne should be deceived by the transparent undercoat with which the ‘Takafol’ insurance agreement is painted. The following terms employed in the agreement are meaningless and deceptive: Waqf, donation, Islamic brotherhood, and the Qur’aanic verse.

"Shaitaan promises you (scares you with) poverty and he commands you with immorality, while Allah promises you forgiveness from Him and kindness." — (Qur’aan)

‘Takafol’ insurance is not a valid Shar’i Waqf institution. The rules of Waqf do not apply to this riba venture. It is abundantly clear from the agreement that ‘Takafol’ is a pure monetary dealing—an exact replica of conventional insurance which is haraam.

"There will dawn over mankind an age when a man will not be concerned with the source (of his income), whether it be from halaal or from haraam." — (Hadith)

Only a meager 10% of the ‘profit’ yielded by investment of the premiums is given to charity. Besides the occasional payout for losses sustained by insured persons, the ‘surplus’ profit is distributed as dividends to those who have purchased insurance cover. The assertion that the Takafol venture is a waqf fund is thus a blatantly fallacious claim.

The claim that the monthly premiums which the insured persons have to incumbently pay in order to maintain the validity of their insurance cover, are ‘donations’ is astonishingly absurd. With unashamed temerity, the ‘Takafol’ insurance agreements stipulates:

Yet, this Agreement shamelessly avers that the incumbent monthly and annual ‘contribut-ions’ are ‘donations’. Forfeiture of the paid premiums in the wake of failure to pay a subsequent premium o­n due date is a brazen act of usurpation of the money which is extracted from the insured clients.

"A body nourished by suht (haraam) will not enter Jannat. Every flesh (i.e. human body) nourished by haraam—the Fire is more deserving of it." — (Hadith)

Those who devour such haraam money acquired by riba and qimaar under guise of ‘halaal’ insurance, ingest into their bodies suht—haraam money which according to the Hadith of Nabi (sallallahu alayhi wasallam) produces "flesh suitable for o­nly for the Fire."

Which concept embodies the factor of the payment of an ‘excess’ when an insurance claim is made for recovery of a loss sustained? Everyone knows that this is a peculiarity of o­nly riba-qimaar insurance. The ‘Takafol’ conventional insurance agreements states:

Conceding to insurance, the ‘Takafol’ agreement states:

This is their interpretation of Waqf, donation, Islamic brotherhood and compliance with the spirit of the Qur’aanic verse cited in the Agreement. The worst of the blatantly fallacious claims of ‘Takafol’ insurance is the averment that the compulsory monthly premiums are ‘donations’.

The pivot of the ‘Takafol’ insurance scheme, just as all other conventional kuffaar insurance, is the compulsory monthly payment of premiums which the ‘Takafol’ agreement species and emphasises in unmistaken terms. There is absolutely no difference between the ‘Takafol’ insurance premium and the premium of all the other forms of haraam insurance. The o­nly misleading difference is the term ‘donation’. While the non-Muslim financial institutions call the monthly contributions made by the insured persons, premiums, the Takafol traders call it ‘donation’. But in terms of the Shariah these monthly payments are not donations.

Anyone who studies the ‘Takafol’ insurance agreement will understand that this scheme couched with Islamic terminology is the same haraam insurance as every other type of haraam insurance available in the riba market.

"Traders will be resurrected o­n the Day of Qiyaamah as immoral persons except those who feared (Allah), were pious and honest." — (Hadith)