The Bahrain-based firm T’azur has introduced a Shariah-Compliant insurance product which would make payments to Islamic charities in the event that the insured is unable to do so.
One of the key problems with Shariah-Compliant Finance has been the lack of transparency surrounding zakat (a form of tithing under Islam) payments to Islamic charities. Many Shariah-Compliant firms facilitate zakat payments for their clients or make zakat payments out right on their own.
The problem arises because one of the 8 required destinations of zakat under Shariah is to fund those who are fighting in the way of allah.
In fact, there are numerous examples of zakat payments finding their way into the hands of Jihadist terrorist organizations. We have detailed those activities extensively here on SFW in two of our categories:
The introduction of this latest charitable donation insurance product by T’azur is the latest evidence of the integral role that Islamic financial institutions play in the zakat system. We also would add that this new product is being introduced at a time when Barack Obama has pledge to ease scrutiny of zakat payments, despite the fact that they find their way into the hands of terrorists all too often…