Morocco adopts draft law regulating Islamic insurance
Saturday, 05 16 2015, Category: Insurance and Reinsurance, Country: Morocco
Morocco's government adopted a bill on Thursday to regulate Islamic insurance, legislation that will face a final vote by parliament later this year, a cabinet statement said.
It is the last step in Morocco's legislative package to regulate the country's fledgling Islamic finance industry. Earlier this year, it issued a decree allowing the creation of a sharia board to oversee the sector.
Islamic finances, which ban interest payments and pure monetary trading, have been growing across Asia, Middle East and Europe.
Sensitive about Islamist ideology, Morocco has long rejected the idea. But the country's financial market lacks liquidity and foreign investors, and Islamic finance could attract both.
Takaful, or Islamic insurance, is seen as a bellwether of consumer appetite for Islamic financial products. It is based on the concept of mutuality and the takaful company oversees a pool of funds contributed by all policy holders.
The bill adopted by the government goes into details on authorisations, takaful and retakaful products and operating process. Sharia-compliant insurance will be overseen by the same sharia board of Islamic scholars in charge of Islamic banking.
The bill also includes some amendments of the law regulating the conventional insurance sector.