Expatriates find takaful insurance mainly in countries with a dedicated framework, such as Malaysia or the Emirates, while in French-speaking Europe the offer is limited to a few life, funeral and repatriation contracts that must be examined clause by clause.
Three needs specific to life abroad
An employee posted or settled abroad must cover local medical care, protect the family in case of death and plan for possible repatriation of the body. Takaful meets these needs through separate family and general funds managed according to sharia.
Malaysia, a market open to all residents
Malaysian takaful is governed by the Islamic Financial Services Act 2013, under licence from Bank Negara Malaysia, and is open to people of any religion. Our guide to takaful in Malaysia details the players and rules of this market.
Expatriation in the Gulf and the DIFC
In 2009 the Zurich group launched Family Takaful through Zurich Takaful, a joint venture based in Dubai's DIFC. Expatriates settled in the Emirates can read our article on Islamic insurance in the UAE for the local offer.
What exists for someone leaving France
In France, Swiss Life launched the Salam takaful life contract in autumn 2013, and Luxembourg's Vitis Life offers Amane Exclusive Life with a minimum premium of 250,000 EUR. These savings contracts do not replace expatriate health insurance.
The Luxembourg case of unit-linked contracts
A Luxembourg life policy, supervised by the Commissariat aux Assurances, can be invested in Islamic ETFs. Strictly speaking this is not takaful, as there is no participants' fund or tabarru', but the tool appeals to some highly mobile expatriates.
Repatriating the body to the Maghreb or Africa
In March 2020 the broker SAAFI announced Sakina, a takaful death, funeral and repatriation offer from 2,000 to 7,000 EUR, reserved for French tax residents. Its current activity is unconfirmed; see also our page on repatriation of remains.
A public precedent for the Algerian diaspora
In January 2011 the Algerian state insurer SAA created a repatriation product for Algerians living in France, priced at 25 EUR per person per year and sold through BIA in Paris. This old rate shows that home-country solutions exist.
Expat health: where the takaful offer falls short
Our research found no international takaful health insurance aimed at expatriates leaving France. You must therefore compare conventional international plans, or take local cover from a takaful operator in the host country where the law allows it.
Why Europe remains difficult ground
At the IFM summit in London in November 2014, Solvency II was described as the biggest challenge facing takaful. In the United Kingdom, Salaam Halal Insurance, launched in 2008 after raising 60 million pounds, went into run-off within a year.
Checking the model of a policy bought locally
In the host country, ask whether the operator uses wakala, mudaraba or the hybrid wakala-waqf model from Pakistan. Surplus sharing depends on it: everything goes to participants under wakala, while under mudaraba it is divided with shareholders.
Returning home and continuity of cover
A local takaful policy often ends with the residence permit. Before going home, check the date cover stops, what happens to sums built up in a participants' investment fund and whether savings can be surrendered or transferred.
Takaful windows and dedicated operators
In Pakistan, the SECP's Takaful Rules 2012 allow conventional insurers to open takaful windows, following Indonesia's example. An expatriate should therefore distinguish a window, backed by a conventional insurer, from a fully dedicated takaful company.
Building compliant expatriate cover
- List your needs: local medical care, family protection, repatriation and savings, according to the planned length of your stay abroad.
- Identify the takaful operators licensed in the host country, such as by Bank Negara Malaysia in Malaysia.
- Ask for the management model and the sharia board's fatwa for every contract offered.
- Compare contributions, wakala fees, any mudaraba share and the rule for redistributing the surplus.
- Check the geographic area covered, the exclusions and the automatic end of the contract when you leave the country.
- Keep repatriation cover that does not depend on your country of residence, to avoid any gap when you move.
Cost components of expatriate takaful protection
| Element | Contract concerned | Benchmark or factor |
|---|---|---|
| Tabarru' contribution | Health, death, disability | Age, country of residence, scope of care |
| Wakala fee | All takaful contracts | Rate specific to each operator |
| Minimum savings premium | High-end life policy in Luxembourg | 250,000 EUR for Amane Exclusive Life (2014) |
| Repatriation benefit | Funeral and repatriation | 2,000 to 7,000 EUR for Sakina (2020, indicative) |
| Surplus redistributed | Participants' risk fund | Claims experience, wakala or mudaraba model |
Documents expatriates are asked for
- Passport and valid residence permit or work visa
- Proof of residence in the host country
- Employment contract or posting certificate from the employer
- Medical questionnaire for health and death benefits
- Proof of tax residence for offers reserved for France
- Ijara or murabaha contract if a home is financed locally
Frequent missteps by expatriates
- Assuming a takaful policy taken out in Dubai or Kuala Lumpur stays valid after you leave the country for good.
- Treating an investment in Islamic ETFs as takaful, when there is neither a participants' fund nor tabarru'.
- Signing up with a foreign operator that is not authorised to cover residents of your host country.
- Neglecting repatriation of the body by counting on community solidarity whose resources remain limited and uncertain.
- Accepting a promised surplus payment that does not appear in the general terms of the contract.
Expatriates' questions about takaful
Can a non-Muslim take out takaful abroad?
Yes in Malaysia, where takaful governed by IFSA 2013 is open to everyone regardless of religion. Elsewhere, conditions depend on each operator, but our sources do not generally report religious affiliation as a membership criterion.
Does international takaful health insurance exist?
Our research identified none aimed at expatriates leaving France. The realistic options are local takaful cover in a country with operators, or a conventional international plan whose clauses and investments you examine carefully.
Does my French takaful life contract follow me abroad?
A savings contract such as Swiss Life's Salam normally remains active, but taxation and the ability to make payments depend on your country of residence. Ask the insurer before leaving, as a change of tax residence can alter the contract.
How can I fund repatriation to Morocco or Algeria?
Through a funeral plan with a repatriation option, a dedicated takaful offer if available, or a product from an insurer in the home country, as Algeria's SAA did in 2011. Check limits, the companion's ticket and the waiting period.
Which authority supervises takaful bought in Malaysia?
Bank Negara Malaysia issues licences and supervises operators. Its draft framework of May 2018 requires surpluses and deficits to be kept separate by fund and participants' consent for any revision of the tabarru'.