Islamic Insurance and European Union Legal Framework

The author intends to shed light on the problems that exist when a takaful insurance decides to provide its services within the European Union markets. Given that there are no single specific rules issued by European legislation concerning takaful, this essay intends to verify if European insurance legislation deals with organizational structures similar to takaful ones, and for which that legislation offers special rules that in such a way respect the Shari’a-compliants principles applicable to takaful. The work is divided into three parts. After an introduction, the second part is dedicated to analyze the European insurance legislation by placing the focus mainly on the long harmonization process of Member States insurance regulations and on new directives regarding capital requirements and distribution of insurance products. The third part highlights what the features of takaful are. The author tries to locate within the European insurance legislation, an organizational structure which provides for a specific discipline that can meet the principles and architecture underpinning the takaful.