IFSB is consulting on an exposure draft on guiding principles on Retakāful (Islamic reinsurance). The draft identifies and sets forth a set of basic principles and best practices pertaining to Retakāful activities of both Takāful and Retakāful Operators, the objectives of which include:
- provide a basis for regulatory and supervisory authorities (RSAs) to set rules and guidance on the operational framework of entities undertaking inward Retakāful activities;
- outline a basis for RSAs to supervise Takāful and Retakāful undertakings’ use of outward Retakāful arrangements; and
- suggest recommended best practices for Retakāful and Takāful Operators and their RSAs to help address regulatory issues concerning Retakāful.
It also outlines relevant regulatory standards and practices that are to be implemented alongside the guiding principles, including the appropriate adoption of the insurance core principles published by the International Association of Insurance Supervisors (IAIS) to ensure prudence in Retakāful regulatory supervision, business and operations. Consultation closes on 4 January 2016 ahead of an IFSB roundtable on Retakāful. (Source:IFSB Consults on Retakāful Principles)