Takaful Regulation, 2008

TAKAFUL ORDER, 2008
TAKAFUL REGULATIONS, 2008
In exercise of the power conferred by section 91(1) of the Takaful Order, 2008, the
Minister of Finance, with the approval of His Majesty the Sultan and Yang Di-Pertuan,
hereby makes the following Regulations –
PART I
PRELIMINARY
Citation and commencement.

1. These Regulations may be cited as the Takaful Regulations, 2008 and shall
commence on the same date as the Takaful Order, 2008.
PART II
REGISTRATION AND FEES
Documents and information required for registration.

2. For the purposes of section 9 of the Order, the prescribed documents and information
to be furnished in respect of an application for registration are –
(a) the name of the applicant company;
(b) its place of incorporation;
(c) if incorporated outside Brunei Darussalam, the address of its principal
place of business in Brunei Darussalam;
(d) a copy of its memorandum and articles of association;
(e) the amount of its paid-up share capital;
(f) the names of its directors and, for each director, the address of the
director’s principal place of business;
(g) the name and registered address of any shareholder holding 5 per cent
or more of its paid up share capital;
(h) the number of its employees and the proportion of those who are
citizens of Brunei Darussalam;
(i) a copy of its audited accounts for each of the last 5 years for which
they are available;
(j) whether the application is for registration in respect of family takaful
business or general takaful business;
(k) in the case of a company incorporated outside Brunei Darussalam,
confirmation from the appropriate authority in its home jurisdiction that it is
authorised in that jurisdiction to carry on the type of takaful business for which
registration is sought and complies with all relevant regulatory requirements in
respect of such business within that jurisdiction;
(l) a business plan describing its intended strategy for the following 5
years in respect of the takaful business for which registration is sought; and
(m) any other related documents as may be required by the Authority.
Registration and annual fees.

3. (1) A registered takaful operator shall pay to the Authority the following fees –
(a) for registration in respect of family takaful business, $20,000;
(b) for registration in respect of general takaful business, $20,000.
(2) A registered takaful operator shall pay to the Authority the following annual
fees on or before 1st January –
(a) for carrying on family takaful business, $10,000;
(b) for carrying on general takaful business, $10,000;
(c) for opening a branch office, $3,000;
(d) for opening a counter, $1,000.
(3) Where a registered takaful operator becomes registered in respect of family

takaful business or general takaful business after 1st January in any year, that takaful operator
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shall pay to the Authority, in addition to the fee payable under sub-regulation (1), one-twelfth
of the fee which will become payable under sub-regulation (2) on or before 1st January in the
following year for each remaining month in that year.
Takaful agent’s and annual fees.

4. (1) The registration fee payable to the Authority by any person under
section 49(5) of the Order to act or hold himself out as –
(a) a corporate agent is $2,000;
(b) an individual agent is $300.
(2) The annual fee payable to the Authority on or before 1st January by any person
under section 49(5) of the Order to act or hold himself out as-
(a) a corporate agent is $1,000;
(b) an individual agent is $200.
Takaful broker’s and annual fees.

5. (1) The registration fees payable to the Authority by any person under
section 54(4) of the Order –
(a) to act or hold himself out as a takaful broker is $5,000;
(b) for opening a branch office is $2,000.
under section 54(4) of the Order -
(a) to act or hold himself out as a takaful broker is $3,000;
Adjuster’s and annual fees.

6. (1) The registration fees payable to the Authority by any person under
section 57(4) of the Order –
(a) to act or hold himself out as an adjuster is $2,000;
under section 57(4) of the Order -
(a) to act or hold himself out as an adjuster is $1,000;
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Inspection fee.
7. The fee payable to the Authority by any person for inspection of or inspection and
copying of any document pursuant to section 65(2) of the Order is $5.00 in respect of each
document inspected on each occasion of inspection together with such reasonable charge as
may be levied in respect of any photocopy supplied to that person.
PART III
FINANCIAL AND OTHER REQUIREMENTS
Surplus of assets over liabilities.

8. For the purposes of sections 5(2) (b) and 10(1)(b) of the Order, a takaful operator
shall have a surplus of assets over liabilities of not less than 20 per cent. In determining the
minimum amount of such surplus of assets, the Authority shall take into consideration the
nature and modalities of takaful business.
Deposit with Authority.

9. (1) For the purposes of section 16(1) of the Order, the amount to be deposited by
a takaful operator with the Authority –
(a) in respect of a takaful operator carrying on family takaful business, a
minimum of $1,000,000; and
(b) in respect of a takaful operator carrying on general takaful business, a
minimum of $1,000,000.
(2) In addition, in respect of a takaful operator carrying on general takaful

business, the minimum deposit from the year after registration shall be subject to 40 percent
of its contribution income net of payment on account of re-takaful in excess of an amount to
be determined by the Minister.
(3) If in a subsequent year there is a decrease in the net contribution income of the
takaful operator, it shall be refunded the difference between 40 per cent of its contribution
income in that year and that of the previous year.
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(4) Any refund as referred to at sub-regulation (3) will be subject to the takaful
operator having satisfied the requirements of the Order relating to the pledging of assets to
the appropriate takaful fund as well as satisfying the solvency requirements.
Minimum paid-up share capital.

10. (1) For the purposes of section 21(2)(a) of the Order, the paid-up share capital of a
takaful operator having a share capital unimpaired by losses, shall be –
(a) in the case of a takaful operator carrying on family takaful business,
not less than $8,000,000; and
(b) in the case of a takaful operator carrying on general takaful business,
not less than $8,000,000.
(2) A takaful operator established or incorporated outside Brunei Darussalam not

having a share capital shall maintain in Brunei Darussalam a surplus of assets over liabilities
of an amount not less than the requirements for the minimum amount of paid-up share capital
of a takaful operator incorporated in Brunei Darussalam.
(3) For the purposes of section 54(1)(b) of the Order, the minimum paid-up share
capital of a takaful broker shall be $200,000.
(4) For the purposes of section 57(1)(b) of the Order, the minimum paid-up share
capital of an adjuster shall be $100,000.
Professional indemnity takaful.

11. For the purposes of section 54(1)(c) of the Order, the minimum limit of indemnity to
be covered under a professional indemnity takaful for any person who intends to be
registered as a takaful broker shall be of not less than $1,000,000 under which the deductible
allowance shall be $10,000.
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PART IV
MINIMUM CRITERIA OF “FIT AND PROPER PERSON”
Minimum criteria of “fit and proper person”.

12. (1) In determining, for a takaful operator or a controller of a takaful operator,
whether a person is a fit and proper person to hold the position of a managing director,
director, chief executive or principal officer pursuant to section 42 of the Order, regard shall
be had to –
(a) his probity, competence and soundness of judgment for fulfilling the
responsibilities of that position;
(b) the diligence with which he is fulfilling or likely to fulfill those
responsibilities; and
(c) whether the interests of participants, potential participants, named
beneficiaries and creditors, as the case may be, are likely to be in any way threatened
by his holding that position.
(2) Notwithstanding sub-regulation (1), a takaful operator shall also have regard
to the criteria under regulations 13 and 14 in determining whether a person is a fit and proper
person.
(3) Without prejudice to the generality of sub-regulation (1), regard may be had to
the previous business conduct and activities of that person and in particular to any evidence
that he –
(a) has compounded or been convicted, or as managing director, director,
chief executive or principal officer, of a takaful operator or a controller of a takaful
operator, has compounded or been convicted, of an offence under the Order, the
Insurance Order, 2006 (S 48/06), the Companies Act (Chapter 39), the Finance
Companies Act (Chapter 89), or any other written law which is punishable with –
(i) imprisonment for a term of one year or more, whether by itself
or in addition to a fine; or
(ii) a fine of $50,000 or more;
(b) has compounded or been convicted, or as managing director, director,

chief executive or principal officer, of a takaful operator or a controller of a takaful
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operator has compounded or been convicted, of an offence under the Banking Order,
2006 (S 45/06) or the Islamic Banking Order, 2008 which is punishable with –
(i) imprisonment for a term of 6 months or more, whether by itself
or in addition to a fine; or
(ii) a fine of $10,000 or more;
(c) has engaged in any business practice appearing to the Authority to be

deceitful, oppressive or otherwise improper, whether unlawful or not, or which
otherwise reflects discredit on his method of conducting business; or
(d) has engaged in, or been associated with, any other business practice, or
otherwise conducted himself in such a way, as to cause doubt as to his competence
and soundness of judgment.
Criteria for managing director or director of takaful operator.

13. A person who is, or is to be, a managing director or director of a takaful operator –
(a) shall have educational qualifications and experience which will enable
him to effectively perform his duties;
(b) shall not have acted in a manner which may cast doubt on his fitness to
hold the position of a director;
(c) shall have agreed to attend, or have attended, at least 75 per cent of the
takaful operator’s board of directors meetings in a year unless his absence is with the
approval of the Authority; and
(d) shall not have been a party to any action or decision of the board or
management of the takaful operator, which is detrimental to the interests of the
takaful operator and its participants.
Criteria for chief executive or principal officer of registered takaful operator.

14. A person who is, or is to be, a chief executive or principal officer of
takaful operator –
(a) shall have the educational qualifications and experience to enable him
to satisfactorily discharge his responsibilities;
(b) shall not have held a position of responsibility in the management of
any company which has been convicted of an offence under any written law during
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his tenure of office unless he proves that such offence was committed without his
knowledge or consent and he was not in a position to prevent the offence;
(c) shall not have held a position of responsibility in the management of
any company which during his tenure of office –
(i) has defaulted in payment of any judgment against it;
(ii) has suspended payment or has compounded with its
creditors; or
(iii) has had a receiver or manager appointed in respect of its
property;
(d) shall be available for full-time employment, and shall not carry on any
other business or vocation, except as a non-executive director or shareholder of
another company;
(e) shall not be engaged actively in any political activity;
(f) shall not cause a conflict of interest situation with that of the takaful
operator, either by himself or his wife, husband, father, mother, son or daughter;
(g) shall not have acted in a manner which may cast doubt on his fitness to
hold the position of chief executive or principal officer, or acted in blatant disregard
for proper professional conduct, especially in dealings with participants, potential
participants and named beneficiaries; and
(h) shall not have been a party to any action or decision of the
management of the takaful operator which is detrimental to the interests of the
takaful operator and its participants.
Discretion of Authority.
15. The Authority shall have full discretion to determine whether a person has complied
with this Part.
Made this day of 1429 Hijriah corresponding

to the day of 2008.
Permanent Secretary, Ministry of Finance.

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TAKAFUL ORDER, 2008

TAKAFUL REGULATIONS, 2008

Citation and commencement.

Documents and information required for registration.

Registration and annual fees.

(3) Where a registered takaful operator becomes registered in respect of family

Takaful agent’s and annual fees.

Takaful broker’s and annual fees.

Adjuster’s and annual fees.

Surplus of assets over liabilities.

Deposit with Authority.

(2) In addition, in respect of a takaful operator carrying on general takaful

Minimum paid-up share capital.

(2) A takaful operator established or incorporated outside Brunei Darussalam not

Professional indemnity takaful.

Minimum criteria of “fit and proper person”.

(b) has compounded or been convicted, or as managing director, director,

(c) has engaged in any business practice appearing to the Authority to be

Criteria for managing director or director of takaful operator.

Criteria for chief executive or principal officer of registered takaful operator.

Made this day of 1429 Hijriah corresponding

Permanent Secretary, Ministry of Finance.

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