Islamic Perspectives

Shariah-compliant New Islamic Insurance Law of Oman

Delhi-based Transworld Consultants, a company specialising in laws in the Gulf states, has come out with an  English version of the New Islamic Insurance Law of Oman.

The law, promulgated by the Sultan of Oman, through a Royal Decree after the approval of the Parliament, governs the “Shariah-compliant cooperative business based on participation and mutual liability of a group of people to cover potential specific risks, through the payment of cash subscriptions to the company, for utilization in the compensation of the victim in case of occurrence of the insured risk, including re-insurance”.

According to the Chief Executive Officer of Transworld Consultants, Syed Saami Mahmood, the new 58-article Law provides that the companies conducting the Takaful insurance business have to be listed on the Muscat Securities Market with a capital of RO 10 million and above.

Mahmood said that the Law does not permit traditional underwriters to open Takaful insurance windows, making it mandatory for a company interested in doing the Takaful insurance in Oman to devote itself exclusively to the Islamic insurance business.