MALAYSIAN ISLAMIC INSURER SHIFTS BUSINESS MODEL
Malaysian Islamic insurer Takaful Nasional has shifted its takaful operating model from Mudharabah to wakalah, beginning with non-life products. Life products are expected to move over around the middle of this year, according to Takaful Nasional CEO Mohd Tarmidzi Ahmad Nordin. He said that the move was necessary because Mayban Takaful and Takaful Nasional were working according to different business models. “Migrating the company’s operating model to wakalah is necessary because eventually, we will only have one takaful company under Maybank. Under the mudharabah model, the policyholders share the profits on their part of the funds, with liabilities shared by the participants. The wakalah model sees the takaful operator receiving a fee for services rendered, with the operating company charging fees from contributions that cover most of the expenses of the business. Only new policies or renewals after January 1 this year will be affected by the shift in model.
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