In this episode, Lisa Schilling explains the role of Retakaful, the Islamic finance equivalent of reinsurance. Retakaful enables Takaful operators to manage large risks, diversify exposure, and remain solvent, while staying rooted in Shari’ah principles. It can be structured as a treaty or facultative agreement and often provides technical expertise in addition to risk-sharing. Despite challenges like limited capacity, regulatory inconsistencies, and a shortage of qualified scholars, Retakaful is essential to Takaful’s global growth and helps extend ethical insurance protection worldwide.
Contributors: Lisa Schilling, FSA, EA, FCA, MAAA; Jon Forster, ASA, MAAA