Local communities launch takaful-type health insurance scheme


Islamic finance pioneers and community leaders in India have come together to introduce a takaful-style mutual health insurance scheme, which currently does not exist in the country, reports Salaam Gateway.

The non-profit health insurance program, called Uplift Mutuals Biradaree, started in April this year in two of Mumbai’s predominantly Muslim towns, Kurla and Malad. The program operates on the model of mutual insurance, with certain features that maintain the values ​​of Sharia-compliant finance.

“The mutual health insurance model by design operates on the principles of takaful in which people contribute an agreed amount to a common pool to support each other and share the risks,” Dr. Shariq Nisar, an academic and financial professional Islamic who helped develop the program. , Recount Salaam Gateway.

In addition, the program operates on the principle of “Prevention is better than cure”, whereby measures and precautions are taken to prevent illness in the first place. “This is not normal insurance, but health service and financial aid,” Dr Nisar said.

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“Monthly clinics are organized in the localities, and doctors are available on call 24×7. But if you still get sick, help each other to get the right treatment and the right doctors at the right price, ”he added.

Uplift Mutuals Biradaree is also designed to be affordable and is open to all financially vulnerable families, not just Muslims. A single member pays INR 700 ($ 10) per year and a family of four pays INR 1,400 per year.

Role of ICMIF

The annual contribution has been kept low as part of the capital and operating expenses is currently covered by external funding from the global industry body, the International Federation of Insurance Cooperatives and Mutuals (ICMIF).

As part of its 5-5-5 mutual microinsurance strategy for India, ICMIF has partnered with Uplift India Association to provide mutual insurance coverage to half a million people over the years. next five years.

Dr Nisar said that when ICMIF studied the Uplift Mutuals model, they realized that it was working according to takaful. “We thought that if we could add Sharia screening functionality to Uplift Mutuals, we could develop an alternative to takaful that would be acceptable to the wider Muslim community,” he said.

Official regulations do not allow the creation of formal takaful initiatives for India’s 172 million Muslims.

The health insurance scheme will operate on the existing platform of Uplift Mutuals, a mutual health insurance model developed by Uplift India Association for 15 years. Uplift Mutuals has set up around nine such mutuals that cover over 300,000 urban and rural poor in the states of Maharashtra and Rajasthan.

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