Acceptance of conventional insurance principles as takaful basic principles: shariah and legal analysis

Generally the concept of takaful is founded under the principles of mutual responsibility, mutual assistance and cooperation and mutual protection or guarantee. The foundation of Takaful is not only of prohibition of riba, gharar and maysir but also it been built on the conventional Insurance principles. The objective of this paper begins with the position of Takaful under Islamic Financial Services Act 2013. This paper also examines the basic principles of conventional insurance principles that can be applied in developing takaful contract. This paper also examine the sources of Shariah that allows an operator of takaful company to apply these principles. The methodology used is qualitative. It adopt library based and content analysis method. This paper concludes there are Shariah justification and distinction of adopting conventional insurance principles in takaful contract.