Participation insurance can be implemented through various models under the supervision of an advisory committee. One such model involves insurance coverage that guarantees religiously permissible matters and risks, and manages financial assets within the framework of participation principles. This is the model preferred by HDI Participation Insurance Inc. Accordingly, HDI Participation Insurance Inc. provides insurance coverage only in certain areas with the approvals it receives from the advisory committee and invests its financial assets in interest-free financial instruments with the premiums received from policyholders. All activities of HDI Participation Insurance Inc. are subject to the approval of the advisory committee.
Another model of Participation Insurance is called Takaful. Generally, Takaful can be defined as "an agreement between individuals exposed to certain risks on the compensation for losses arising from the occurrence of these risks." In this model, a risk fund created through donations from policyholders is entrusted to the insurance company for the purpose of carrying out insurance activities and investing the risk fund in interest-free financial instruments. The insurance company receives a fee or profit share for the insurance services it provides in the event of participants' exposure to risk, and for the effort it expends in managing the risk fund. If the risk fund has a balance after all expenses, the policyholders have the authority to use this balance. If the risk fund has a deficit after expenses, the insurance company provides the risk fund with an interest-free loan (karz-ı hasen). The relationship between the insurance company and the risk fund may be one of agency and/or partnership.