Pru Life UK Takaful FAQs

Takaful means “guaranteeing each other” in Arabic. It is a Shari’ah-compliant type of insurance in which participants contribute to a common fund, called the Tabarru or the Participant Risk Fund (PRF), to support one another during times of misfortune such as developing a critical illness, getting into an accident, and death.

In Takaful, the risk is shared among the participants, whereas in conventional insurance, the insured transfers the risk to the insurer. Instead of paying premiums, Takaful participants agree to contribute to a pool or mutual fund from which claims are paid.

Both Takaful and the conventional insurance that Pru Life UK also offers provide financial protection during times of misfortune.

Like any Islamic finance instrument, Takaful complies with the prohibition against interest (riba), uncertainty (gharar), and gambling (maysir), which are not permissible in Islam.

• No Usury (interest)
  Riba does not occur in Takaful because it is purely based on a mutual aid grant contract and only invests in Shari’ah-based investment instruments.
• No Gharar (uncertainty)
  The practice of Gharar is not allowed and any vagueness in Takaful is forgiven because it occurs in a grant contract (donation) of a social nature.
• No Maysir (gambling)
  The mutual aid grant contract allows participants who are at risk to receive help and those who are not at risk can help others and get an underwriting surplus if there is any.

As a Takaful Window Operator, we manage and administrate the common fund and charge fees in exchange.

Pru Life UK is the first licensed Takaful operator in the Philippines. Takaful supports our ongoing mission to bring accessible and inclusive financial solutions to everyone by making available a Shari’ah-compliant form of insurance to Muslim Filipinos who, as confirmed through a market study commissioned by Pru Life UK, have been financially unserved and underserved in the past and broadening the insurance options of the rest of the population.

For Pru Life UK, Takaful is more than just an insurance product; it is a way for us to build resilient communities and promote long-term growth in the Philippines.

Prudential plc, the parent company of Pru Life UK, has a strong and proven track record in Takaful operations in markets with significant Muslim populations such as Malaysia and Indonesia.

Yes. Many non-Muslims worldwide recognise the social and economic benefits of Takaful and are using it as an alternative to conventional insurance.

It may happen that the common fund or the Tabarru may not yet be enough to cover benefit claims. In this case, the Takaful Operator will cover the shortfall in the form of Qardh, or an interest-free loan.

In cases where the Tabarru’ Fund has enough contributions so that there will be funds left even after actual claims are paid, and after the Takaful Operator has set aside provisions for technical allowances and solvency requirements, the positive difference is called Underwriting Surplus.

Technical allowances and solvency requirements are based on the Takaful Operator's calculations and are intended to cover for future claims and are determined with the goal of ensuring the long-term sustainability of the Tabarru’ Fund.

Depending on the policy provisions and the agreement of the participants, the Underwriting Surplus, if any, will be used to pay the Qardh, if any, and may be distributed to the participants, retained in the Tabarru’ Fund, or donated to charity.