FG Inaugurates Board on Takaful Insurance
James Emejo Minister of State for Finance, Alhaji Bashir Yuguda yesterday inaugurated an advisory council for the implementation of the Takaful insurance product as part of ongoing reforms in the insurance sector of the economy. Essentially, Takaful insurance is a type of an interest-free Islamic insurance practice whereby members contribute money into a pooling system in order to guarantee each other against loss or damage.
It is particularly different from the conventional insurance practice as it has an investment window which allows profit to be shared between operators and participants.
According to the minster, the inauguration of the board came at a time when the insurance industry in the country is geared towards moving the economy to a greater height among the developing nations.
This, he said, was the result of the National Insurance Commission’s resolve to key into the National Financial Inclusion Strategy launched by the federal government in 2012.
Yuguda said: “The development of the operational guidelines for the regulation of Takaful insurance business in Nigeria by NAICOM heralds an important financial inclusion platform. Your role as advisory council for the regulator is to serve as an additional layer for addressing issues that may arise from Takaful operators’ regarding Shariah compliance in Takaful undertakings.
“In this era of risk management and risk based approach to financial service regulation, you will appreciate that Shariah non-compliance is identified as the top most in ranking of risks in Islamic finance.”
He called on members of the advisory council to deploy their wealth of experience in the discharge of their responsibilities as much is expected of them by the industry.
The Commissioner for Insurance, Mr. Fola Daniel said the inauguration was another step toward the implementation of Takaful guidelines.
He said the advisory council would headed by Prof. Dawud Noibi as chairman.
Noibi who spoke at the event said the council would do all within its powers to effectively discharge its mandate.
He said:”I want to thank you for the confidence reposed in us to serve in this area of insurance and we promise to deliver on our mandate.