Takaful Investment Portfolios

Dr. AbdulRahman Khalil Tolefat began his career at the Central Bank of Bahrain. He later served as both chief executive officer and chairman of Allianz Takaful in Bahrain, the global hub for Islamic insurance (takaful) of Allianz Group. After leaving Allianz, he founded ITQAN Financial Services for which he now serves as Chairman and Managing Director. In addition, Dr. Abdul Rahman was a member of the CBB Committee that developed the insurance rulebooks in coordination with PricewaterhouseCoopers and a member of the working group between the International Association for Insurance Supervisors (IAIS) and the Islamic Financial Services Board (IFSB).Dr. Mehmet Asutay is a Reader in Middle Eastern and Islamic Political Economy and Finance at the School of Government and International Affairs, Durham University; Director of the Durham Centre for Islamic Economics and Finance; Course Director of the MA/MSc in Islamic Finance; and the Director of the Durham Islamic Finance Summer School. Also, he serves as Managing Editor of Review of Islamic Economics and Associate Editor of the American Journal of Islamic Social Sciences, and is on the Editorial Advisory Board of International Journal of Islamic and Middle Eastern Finance and Management.

• Preface ixAcknowledgments xiiiList of Abbreviations xvChapter 1 Introduction 1 Rationale for Researching Investment Portfolio Composition of Takaful Companies 1Aims and Objectives 4Scope and Delimitation 5Research Methodology 6Overview of the Book 6Chapter 2 Insurance and Islamic Law: An Introduction to Takaful 9The Concept of Insurance in Islamic Sources 9Views of Contemporary Jurists on the Insurance Contract 13Arguments Regarding the Validity or Invalidity of Commercial Insurance 15Conclusion 27Notes 28Chapter 3 Takaful Models and Implementations, Trends, and Developments 31Takaful Undertaking Principles 31Islamic Insurance Operational Models 32Differences Between Takaful and Other Forms of Insurance 44Trends and Developments in the Takaful Industry 45Conclusion 52Notes 53Chapter 4 Research Methodology 55Methodological Shortcomings of the Literature 56Research Strategy 56Research Questions, Objectives, and Hypotheses 57Research Design 58Sampling Strategy 59Research Methods 61Quantitative Data Analysis 68Qualitative Data Analysis 70Conclusion 70Notes 71Chapter 5 Exploring Investment Behaviours and Investment Portfolios of TakafulOperating Companies in the GCC and Malaysia 73Total Investment Portfolio of Takaful Operating Companies for All Funds 74Investments in Shareholders’ Fund 75General Fund 86Family Funds 94Conclusion 97Chapter 6 Locating the Differences Between Actual and Desired Investment Portfolios 99Shareholders’ Fund 101General Fund 106Family Funds 111Conclusion 114Chapter 7 Contextualising the Findings 117Overall Portfolio Compositions 117Investment Accounts 125Investment in Sukuks 129Investment in Equities 134Return on Investment (ROI) 138Mutual Funds/Unit Trusts 140Real Estate Investments 141Conclusion 142Notes 143Chapter 8 Conclusion and Recommendations 145Main Findings of the Study 145Recommendations of the Study 149Research Limitations 153Recommendations for Future Research 153Conclusion 154Note 155Appendix A 157Appendix B 163Appendix C 215Bibliography 217About the Authors 223Index 225