These bonds are structured based on the terms of the insurance contract and the power of attorney contract. In these bonds, based on the reinsurance contract, central insurance or insurance companies transfer part of their insurance risks to the capital market. Bond buyers are placed as insurers in the reinsurance contract and in return for providing reinsurance services, they have the right to receive a certain amount as insurance premium from the insurer (central insurance or insurance company).
(Note: Since reinsurance bonds are based on power of attorney, the requirements mentioned above are also valid for reinsurance).
Profit Settlement of Bonds

If at the maturity of the bonds, the damage agreed upon in the reinsurance does not occur, the principal capital and the total profit from the investment operation belong to the bondholders.

Failure to pay part of the profits from investment operations during the period of the bonds to the investors before the maturity date is permissible.

Reinsurance bonds do not have rate of return on account, but the bondholders are settled based on the amount of the actual calculation profit resulting from the investment in certain periods of time (for example, every two or three months), which is permissible.

Responsibilities of investors

It is necessary to provide the investors with transparent data as to the operation process and executive instructions so that the privileges and responsibilities resulting from this type of investment to be clear for the investors and no Gharar in this area is left.

Trading in the Secondary Market

The trading of these bonds in the secondary market is permissible, provided that the collected and invested amount and the daily value of the asset portfolio of the bondholders are known.

Attachment to Bonds with Embedded Put Option

The attachment to reinsurance bonds is shariah-compliant. The price exerted in selling option price can cover the principal of the nominal amount of the bond or a minimum amount of profit.