What and How Is Islamic Insurance Working?

As the trend happening in most countries (especially Islam countries), there are offers for Islamic insurance. Basically, the Islam insurance policies are created based on the teaching of Islam basic principles. Offered with many offers of Islamic insurance, many people still do not understand what and how is Islamic Insurance work. As found from a source, Insusite is sharing the basic essence of Islamic insurance. As below cited, here is the basic knowledge of what and how is Islamic insurance work and also the essence of Islamic insurance.

The essence of Islamic insurance - indeed, for all Muslims to live and die, only Allah the Almighty Creator himself. At that already exists, so that all Muslims are not alone. But when you pray in the mosque and mushallah berislam fasting, zakat and hajj only. But even when he was in the market, banks and offices. When he was trade and investment in capital markets and insurance.

The same spirit that should turn on the dynamic of Islamic resurgence in the global economy. In Indonesia alone, the banking system without interest applied by the Bank Act 7 of 1992, which is reinforced by the perception of the two banking systems, Islamic finance has grown rapidly over the last three years. These data indicate perbankkan of total assets increased from 0.11 in 1999 to 0.33 in 2001, the percentage paid to third parties in connection with 0.07 to 0.3 percent percent in the same period, and expansion of business. to 29 cities in Java, Sumatra, Sulawesi and Kalimantan.

Department of Insurance has followed the same trend with insurance companies operating in the fact that Muslims have three takaful insurance, family insurance, Islamic insurance (life) and Mubarakah In addition, some insurance companies have to change departments. Great Eastern Islamic tradition MAA by Bumiputra (life insurance) and the Treasury Tripakarta Takaful market share in 2001 to only 0.3 percent of total premiums. Future development work will get the message of Islam is very broad in scope, increase public awareness. In addition, government policies, many of which support the development of Islamic insurance is liability insurance agreement for the pilgrimage is managed by insurance companies in the field of rule of law being nailed to the special rules on Takaful to give. have a significant impact of the Banking Act 1998.

Islamic Insurance is a part of life, in accordance with the principles of monotheism Every human being has the power to realize that all the cars on the disaster that comes from God, not whether it's death by accident or burn the stores we have.

There are many ways people deal with disaster risk. The first method is to put your own (maintain) the risk that some people at risk. (Risk Transfer) to another switch, and the third will be managed together. (Sharing risk).

direnungi interesting to note that since the beginning of the existence of insurance mechanisms has always been associated with Islam. This means that disaster will not be a problem of individuals but as a group, even if, for example, the incident occurred only a few people. (Special Risks), especially when the events occurred in the wider community. (High Risk), such as earthquakes and floods. Allah confirms that in a few words in the Koran, among others, in a letter in verse 2 and Al Ma'ida - Baqarah 177 in the same way on God's promise is "to provide food and relief from distress Login. Fear" (Surah Quraysh: 4) can be heard often in the hands of others who moved God to help us realize the promises of many traditions of the Prophet Muhammad ordered the Muslims to protect each other in trouble ..

Al-Quran verses and hadith based on the disaster and the loss of the disaster that must be shared. (Risk Sharing), so instead of each individual to bear alone. (Risk Retention), or transferred to third parties. (Risk), this control is the essence of a true sharing of risk in Islamic insurance, which is used to protect the principles of cooperation, sharing and responsibility. (Cooperation for mutual protection) which can be abbreviated by the principle of the CMP.

Very different from what happens in the traditional insurance market. There is a risk transfer. You'll pay a premium to transfer the risk that you can not stand the insurance company, it is "sold" to the risk of loss. But inevitable. This is where the gaps "traditional insurance contracts, viewed from an Islamic perspective. The theory of Islamic contracts relating to commodities. (The problem) is safe, whether in the form of goods or services. This failure is compounded by the condition that the prize money will be forfeited if the loss does not occur, otherwise multiplied by the number of premiums paid as compensation when the insured risk occurs.

However, risk transfer mechanisms such as this will help the balance of power in the management of the insurance contract between the simplest level, for example, when the insurer, the insured to do their best to avoid them. losing someone else who has a strict risk management, on the other hand, the insured should not be because he has moved. The risk to the insurance company to a more complex level, there has been any fraud in filing a claim, either in the form of agreement that was wrong. (False Claims), and filed claims worth more than what it is.

Risk sharing is recommended in Islam is that moral hazard is possible in conventional insurance. God willing, will not happen because everyone in his life becomes for all participants. Funds collected. (Fund) for participants not only sympathy. But those who suffer losses that have been invested. (Of course, according to Islamic investment rules) and the results will be distributed to participants the principles of mudaraba.

The result will be negative if the risk is not managed properly in order to collect a number of large claims. As a result, students lose the opportunity to get this result. This mechanism alone contributes to each participant of risk and risk management of all the false statement is likely to occur not only because it has a moral and ethical dimensions inherent in it. But also because of the risk sharing mechanism with its own principles of mudaraba to avoid bad things BRI - Shawab Allah knows best.

Source:hxxp://insurance-info21.blogspot.com