Called to account.When a credit rating agency A credit rating agency (CRA) is a company that assigns credit ratings for issuers of certain types of debt obligations. In most cases, these issuers are companies, cities, non-profit organizations, or national governments issuing debt-like securities that can be traded on a is invited to rate takaful | Takaful is an Islamic insurance concept which is grounded in Islamic muamalat (banking transactions), observing the rules and regulations of Islamic law. and retakaful insurance--which is happening with increasing regularity as their numbers grow--it has to consider the practical implications for its analysis of this Shariah-compliant concept of insurance. Certain aspects of takaful remain outside the analysis. One is the fundamental idea that the customer is less a policyholder paying a premium to buy a policy and more an entrepreneur sharing risk with others while paying a contribution to participate in any surplus that may arise on the takaful company's underwriting and investment funds. AaAaAaAaAaSimilarly, credit rating agencies Credit Rating Agencies Firms that compile information on and issue public credit ratings for a large number of companies. are relatively unconcerned by the specialist terminology used, and remain agnostic whether premiums should be called tabarru (donation, contribution or gift), or that policyholders are called "participants". It is not the role of a credit rating agency to get involved in any debate as to whether only takaful insurers comply with Shariah law regarding riba (usury usury: see interest. usury In law, the crime of charging an unlawfully high rate of interest. In Old English law, the taking of any compensation whatsoever was termed usury. ), gharar (uncertainty), and maisir (gambling). AaAaAaAaAaWhen the pursuit of Islamic commercial principles leads to changes in the way an insurer presents its accounts, then the credit rating agency needs to understand what is happening. A glance at the accounts of any takaful insurer will reveal that both the balance sheet and the income statement are split to reflect the separate and sometimes divergent fortunes of the operating and shareholder accounts. The surpluses of each are separately available to policy-holding participants and shareholders respectively. AaAaAaAaAaA more detailed scrutiny of takaful accounts will reveal significant and sometimes complex financial cross-flows between participants and shareholders. These exchanges between the participant and shareholder accounts may differ according to the type of takaful being practised. Copyright Islamic Banking & Finance. All rights reserved. Provided by Syndigate.info an Albawaba.com company |
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