DIFFERENCES BETWEEN TAKAFUL AND CONVENTIONAL INSURANCE

TAKAFUL PRACTICES	CONVENTIONAL INSURANCE PRACTICES
The validity of the subject matter of a policy is that it must be valuable and the value of a thing is determined based on the Shariah principles.	The validity of the subject matter of a policy is determined based on the civil law principles
A defined risk is required	A pure risk is essential
The minimum age of the policy holder  is proposed to be age of puberty but a minor at any age below the age of puberty may have the right to hold a policy if the policy is beneficial for him. The policy holder should have proper understanding of the policy and the policy is ratified and controlled by the guardian.	The minimum age of the policy holder is 16 but a minor between the ages of 10 & 16 has the right to hold a policy provided that a written consent from the guardian is obtained.
The agents and the brokers should enjoy a share of profits over the policy and the broker  may also have the right to demand from the policy holder  a counseling fee if any.	The ages and the brokers are basically paid out of the paid-premiums of the policy holder.
The nominee may not be treated as an absolute beneficiary but only a mere trustee.	The nominee is an absolute beneficiary of the policy.
The beneficiary has the right to claim according to the principles of al-Mudharabah financing technique.	The beneficiary in a life policy has the right to claim the whole amount named in the policy.
Terminologies: Participant Contribution	Terminologies:        Insured       Premiums