New regulations governing Takaful insurance in Egypt

The Financial Regulatory Authority has adopted new regulations governing Takaful operations in Egypt.

Applicable to all companies licensed to operate in the sector, the new rules provide, among other things, for:

• the introduction of three distinct operating models for the takaful account (participants’ fund): Wakala, Mudarabah, and a hybrid model combining the two systems
• the establishment of a comprehensive framework for insurance policies, defining the nature of the contractual relationship, mechanisms for distributing insurance surpluses, and Sharia-compliant investment methods
• the creation of technical reserves aimed at strengthening the sector’s financial stability
• the obligation for Takaful operators to establish an independent Sharia Supervisory Board composed of at least three members

Through this initiative, the FRA aims to revitalize the Takaful market and support its growth in line with the Unified Insurance Law enacted in 2024.