12. Regulating and Supervising Takaful

Takaful companies invite participants from public to deposit money into a takaful fund and become participants. For better safe-keeping of this money and more effective delivery of the services promised, proper regulation is a must. The regulator should develop a mechanism in which only sound individuals can establish takaful operators. The regulator should provide a licence only when it is satisfied with the expertise and transparency of the takaful operator’s shareholders and its team. Takaful companies claim Shariah compliance; therefore, this claim should be checked by independent Shariah professionals. The role of Shariah professionals within the takaful operator is very important, as they perform important functions such as vetting products for Shariah compliance, approving investments from a Shariah point of view, refunding any surplus to participants and putting any doubtful profits into a charity fund.