Mohamed H. El-Dishish

Takaful is a simple co-operative way of financial protection that extends benefits to both participants and community according to Shariah. It is based on the principles of Ta-awun (co-operation), brotherhood and solidarity for financial aid between participants. In the case of the Nile Takaful Company, it concerns the members of the public and companies contributing to, and benefiting from, Takaful protection plans. The contribution paid by the participant under the Takaful scheme is considered as a donation, and will be separated into two funds. These are known as 'protection' and 'investment', according to the nature of cover and the type of plan being participated in. Both funds will be managed by Nile Takaful (Operator). A portion of the contribution, which is placed in the Protection Fund, is created by donations from participants to pay all losses that occur. Therefore, the liability is spread amongst all certificate holders, and all losses/profits will be shared between the participants and Nile Takaful. The other portion of the contribution is placed in an Investment Fund. All investments must be in compliance with Shariah which prohibits investment in Haram activities and requires the use of instruments that are free of Riba. The participants will be entitled to the profit according to their share under the principle of Mudharabah.