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  • BC-3 BC-3 Takaful Firms

    • BC-3.1 BC-3.1 General Requirements

      • BC-3.1.1

        This Chapter applies only to those insurance firms licensed to conduct insurance business under takaful principles.

        Amended: January 2007

      • BC-3.1.2

        The CBB acknowledges that the nature of takaful and the operation of a takaful business are not entirely equivalent to and in some respects different from a conventional insurance business. The specific requirements set out in this Chapter aim not only to allow takaful firms to operate in Bahrain within the CBB's insurance regulatory regime on a basis consistent with conventional insurers but also to recognise some of the differences in takaful that are relevant to the way in which takaful business is carried on.

        Amended: January 2007
        Amended: October 2007

      • BC-3.1.3

        The specific requirements in this Chapter are additional to Chapters BC-A to BC-2. The requirements in Chapters BC-A to BC-2 apply to takaful firms unless those requirements are specifically modified or waived by this Chapter.

        Amended: January 2007

    • BC-3.2 BC-3.2 Restriction on the Use of Terms

      • BC-3.2.1

        The use of the terms 'takaful', 'retakaful', 'general takaful' and 'family takaful' may only be used to describe the products of insurance firms that are Islamic financial institutions within the meaning of the CBB Rulebook.

        Amended: January 2007
        Amended: October 2007

      • BC-3.2.2

        For the purposes of this Module, references to takaful shall be taken as including 'takaful', 'retakaful', 'general takaful' and 'family takaful'.

        Amended: January 2007
        Amended: October 2007

      • BC-3.2.3

        The use of the term 'Islamic insurance' should be avoided and may never be used by a firm not licensed to conduct the regulated activity of takaful.

        Amended: January 2007
        Amended: October 2007

    • BC-3.3 BC-3.3 Marketing and Promotion

      • BC-3.3.1

        An insurance firm may only offer takaful products if it is licensed to do so. An insurance intermediary may offer both conventional insurance and takaful products but must provide clear information to enable consumers to make informed choices.

        Amended: October 2007

      • BC-3.3.2

        Any comparison between takaful and conventional insurance products must draw the customer's attention to the principal differences between these products. These differences may include:

        (a) Whether there is a contractual right to claims or benefits or whether these are discretionary on the part of the firm;
        (b) The basis on which benefits and surpluses are allocated to, and between, policyholders and participants; and
        (c) Whether there is any future liability of policyholders (or participants), individually or collectively, for deficits in the policyholders' (participants') funds.
        Amended: January 2007
        Amended: October 2007

    • BC-3.4 BC-3.4 Disclosure

      • BC-3.4.1

        Takaful firms must provide participants and shareholders with clear information about the performance of their business. This information must, as a minimum, comply with relevant AAOIFI standards, in particular Standard 13 (Disclosure of Bases for Determining and Allocating Surplus or Deficit in Islamic Insurance Companies) and 12 (General Presentation and Disclosure in the Financial Statements of Islamic Insurance Companies).

        Amended: January 2007

      • BC-3.4.2

        Takaful firms must clearly disclose to participants the calculation (percentage) and amount of wakala fee and mudaraba share of profits paid by the takaful fund to the takaful operator.

        Amended: January 2007