What is Islamic Insurance?
If in the past you could only use conventional insurance, now Muslims can use sharia insurance. What is Islamic insurance? Well, this article will provide a complete explanation for you regarding one of these types of insurance.
Here, we will discuss the meaning, legal basis, agreement system, and also products from sharia insurance. So, see all the explanations here until the end.
What is Meant by Islamic Insurance?
Islamic insurance is the definition of a business or service created by the Islamic insurance company with the aim of protecting and helping each other between policyholders or insurance customers. This is done by collecting and managing funds according to the Islamic system, namely tabarru. So, the funds that have been managed will be returned to insurance customers when they experience a problem or financial risk. Refunds are made with a contract or agreement based on Islamic principles.
So, there is a principle of sharing of risk in Islamic insurance. That means the risk of one person is charged to all insurance customers. This is what distinguishes conventional insurance from Islamic insurance. Well, the main advantage of Islamic insurance is the underwriting surplus system.
Islamic insurance does the allocation of funds and also the underwriting surplus system. The system is the difference from the total contribution after adding recovery claims from reinsurance. Then, it is reduced by the payment of donations or claims, technical, and reinsurance contributions. In conventional insurance, the underwriting surplus belongs to the insurance company while in Islamic insurance it belongs to the policyholders and the company with a certain percentage.
Basic Law of Islamic Insurance
After understanding what is Islamic insurance, now let's discuss the legal basis of the insurance. So, every country must have specific rules and policies that govern all processes and financial transactions in Islamic insurance and the Islamic insurance company.
However, in general Islamic insurance is regulated by laws related to insurance business. An example is in Indonesia, UU No. 40 2014 regulates all insurance businesses and insurance transaction processes in Indonesia. So, insurance companies must carry out operational activities based on these regulations.
In addition, Islamic insurance is also based on several verses of the Qur'an such as QS. al-Hashr 59:18 and QS. al-Maidah 5:1-2. All of these verses of the Qur'an form the basis of financial transactions in Islamic insurance.
Types of Agreements on Islamic Insurance
There are several types of agreements on Islamic insurance. The first is a grant or help which is known as tabarru. The second is mudharabah or tijarah. The third is wakalah bil ujrah. The last is mudharabah musyarakah.
Islamic Insurance Products
Actually, Islamic insurance products are in accordance with each insurance company. However, in general there are several types of Islamic insurance products provided by the Islamic insurance companies.
- Sharia life insurance: This is insurance used to provide inheritance after the policyholder dies.
- Islamic education insurance: This insurance is used as funds for payment of education costs.
- Sharia health insurance: This is a type of health insurance implemented according to Islamic principles.
- Hajj and Umrah insurance: This Islamic insurance is specifically used for the costs of departing for Hajj or Umrah.
- Sharia loss insurance: This insurance is used to provide compensation to insurance customers who experience financial losses.
Of course there are many other products from sharia insurance. After understanding what is Islamic insurance, now you should be more confident about using this insurance.
Post a Comment for "What is Islamic Insurance?"