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  • HC-2.3 HC-2.3 Shari'a Supervisory Board[versions up to January 2011]

    • HC-2.3.1 [versions up to January 2011]

      An insurance firm licensed to conduct insurance business according to takaful principles must establish a Shari'a Supervisory Board. The firm must also comply with AAOIFI Governance Standard for Islamic Financial Institutions No. 1 ('Shari'a Supervisory Board: Appointment, Composition and Report').

      Amended: January 2007

    • HC-2.3.2 [versions up to January 2011]

      The function of the Shari'a Supervisory Board is to review the operations of the takaful company and ensure that these are compliant with the principles of the Shari'a. In doing so, the Shari'a Supervisory Board is likely to provide guidance and advice to the takaful company's Board and management on all aspects of a takaful operation, with a particular focus on product design, the handling of claims and surpluses, the calculation and allocation of the operator's costs, the approval of investments and accounting issues.

      Amended: January 2007

    • HC-2.3.3 [versions up to January 2011]

      In the case of overseas insurance firms operating according to takaful principles, the requirement to appoint a Shari'a Supervisory Board in Paragraph HC-2.3.1 may be waived by CBB, if the firm has appointed an equivalent Shari'a Supervisory Board at the parent entity level, of sufficient expertise and credibility.

      Amended: January 2007

    • HC-2.3.4 [versions up to January 2011]

      An insurance firm licensed to conduct insurance business according to takaful principles must comply with all other AAOIFI governance standards for Islamic Financial Institutions.

    • HC-2.3.5 [versions up to January 2011]

      For takaful firms, full compliance with AAOIFI Governance Standard No.1 is required. The CBB would actively encourage full compliance with all the AAOIFI governance standards but in so doing accepts that these standards themselves include not only standards but also guidance.

      Amended: January 2007

    • HC-2.3.6 [versions up to January 2011]

      The office of Shari'a Board Member is a controlled function: see Module AU (Authorisation).

      Amended: January 2007
      Amended: October 2007

    • HC-2.3.7 [versions up to January 2011]

      The Shari'a Board requirements contained in Section HC-2.3 are additional to the other high-level control requirements contained in this Module.