A portion of your total contribution, after we deduct our Wakalah Fee, is pooled into a common fund called the Risk Fund (RF) as your commitment to make Tabarru’/donation (i.e. Iltizam Bi Al Tabarru’). This enables you to fulfil your obligation of mutual help and joint guarantee should any of your fellow participants suffer a defined loss where your donation is meant to help others and others’ donations are meant to help you.
Actual donation (Tabarru’) is deemed to have occurred only upon payment of claims and claims-related costs from the RF. The balance of the commitment amount remaining in the RF, net of actuarial-related reserves and other costs as approved by Shariah Committee, if any, will be considered as surplus.
Based on our Appointed Actuary’s recommendation, a portion of this surplus may be retained in the RF and the balance will be shared equally between you and us as Surplus Distribution.
On the other hand, there will be no Surplus Distribution if there is no excess in the fund after deducting all claims payable and reserves.