» TAKAFUL INSURANCE LAW IN THE SULTANATE OF OMAN

One of the mojor problems of the Islamic financial institutions in many countries represented in working under the traditional legislation of the financial institutions, however Sultanate of Oman is considered as one of the countries that has successfully exceeded this obstacle by adding the sixth chapter regarding to the Islamic Banks. Besides, the Royal Decree No.11/2016  has issued Takaful insurance law on March 16, 2016.

 The law has been issued in eight chapters each chapter includes 58 Articles. This law puts the core principles of the Takaful Insurance and takes the advantages of the countries experiences and avoids the negatives. The lawivities of Takaful Insurance in the country are supervised by a governmental authority to ensure the protection of the Takaful Insurance customers and avoid manipulation with the customers funds as in some companies, while this represents an obstacle faced the Takaful Insurance in the countries which do not take this issue into consideration.

The law gives the General Authority of the Capital Market the right to:
   - Issue the licences for prlawicing the Takaful Insurance lawivities.
   - Supervise the companies to achieve commitment to the Insurance law in Sultanate.
  - Prepare and put the necessary and appropriate studies and plans to develop and improve the Takaful Insurance lawivities.
  - Increase the awareness of the Takaful Insurance through the awareness  programs in this regard.  

 The vital role of the Higher Authority of Sharia Control is to unit Fatwa, prevent the conflicting Fatwa of the Control Authority in the different companies, ensure commitment to accounting standards issued from Auditing and Accounting Authority of Islamic financial Institution and prevent being pressured by the Board of Director.

 The Takaful Insurance is defined as a cooperative lawivity consistent with the provisions of Islamic Sharia and based on the participation and Takaful of group of people to face specific risks through the cash subscriptions of the company to compensate the injured in case of falling the danger of insured against them such as Takaful Re-Insurance lawivity.

 The Takaful Re-Insurance lawivities are as follow:
 The Family Takaful Insurance branch - The General Takaful Insurance branch.
 The law defines the components of the Takaful Insurance Company as follows:
 1- The Participants: each party is involved with the company through a Takaful Insurance Contrlaw.
 2- The Executive Management of the Company, General Manager, Financial Officer, Compliance Officer and any other person holding a senior job in accordance with the company's organizational structure.
 3- Sharia Control Committee:  Sharia Control Committee in the company should be formed not less than three members among them a specialist in the financial translawions jurisprudence and an expert in the field of the Takaful Insurance as prescribed by the Article 22.  Besides, the Committee specializes in supervision and control on the Takaful Insurance lawivities to ensure being consistent with the provisions of Islamic Sharia.
 -  As prescribed by the Article No. 33, there should be a seperation between the shareholder’s fund and subscriber’s fund through creating a fund called Shareholders Fund and another one called Subscribers Fund for each branch of the Takaful Insurance branches managed by the company.
 - In the Article 34, each funds refered to in the Article 33 is considered an independent accounting unit thus the necessary books and records are created.
  - The Article 35 prohibits use of subscribers funds except for covering the expenses of the funds adminstration (Wakalaa) or Mudaraba share or any other expenses are approved by the Sharia Control Committee. The regulation shows the rate of Wakalaa wage, Mudaraba share and the method of calculation.
 

 If we compare between this law and what is mentioned in this research about the Takaful Insurance and what should be take in the prlawical application of the Takaful Insurance companies, we find that the law take into account the pros and keep away the cons and benefits from the prior experiences of the Islamic Takaful Insurance. Thus, the Omani experience has fully succeded in the special legislation of Takaful Insurance in the Sultanate which is an accurate and commit to the Islamic Sharia requirements thus preaches a promising future for the Islamic Takaful Insurance in the Sultanate.

It is noteworthy that there are two Islamic Takaful Insurance Companies in Oman are El Madina Takaful and Takaful Oman has entered the insurance market in January 2014.