In case of loss of the premium pool collected by the participation insurance company, the related loss is covered by the shareholders of the insurance company by issuing benevolent loan (interest-free debt). Then, if the pool has an excess balance, the debt is paid to the shareholders first.
Coverage, collection, damage and operation processes are the same as insurance product content. The most important difference is the financial areas where the collected premiums are evaluated. While the participation insurance company evaluates the collected premiums in participation finance products and there is a interest sensitivity, the conventional insurance company can evaluate the collected premiums in conventional finance products.
In all policies, which are the application of insurance companies and where renewal discounts are given, renewal discounts are also given by participation insurance companies on the policy.
Technically, risk acceptance criteria are similar in almost all insurance companies. In participation insurance companies, apart from these criteria, it is also checked whether the place or commodity to be insured is religiously permissible within the framework of the rules of Islamic law.
All insurance products in the insurance sector can also be arranged by participation insurance companies for all the needs of the participants.
Policy premiums are determined according to risk acceptance conditions and company policy. Participation insurance company policy premiums can be even more competitive than conventional insurance company policy premiums.