This paper describes the process of the conduct of preliminary tests to determine the construct and content validity of the chosen data collection method for a study into the relationship between Islamic principles and objectives, Islamic financial law and takaful (slamic Insurance) operations and practices in Nigeria. Semi-structured interviews were tested on a select group of respondents mirroring the intended subjects in the field. The pilot test showed the construct to be both valid and reliable while giving the opportunity to insert refinements to the research tool.

This paper was undertaken with the purpose of conducting a critical review of the framework for Takaful in Nigeria in achieving shari’ah compliance by comparing it with those available in Malaysia and Pakistan. The review looked at laws and other regulations, Takaful operations including models and marketing structure and dispute resolution mechanisms. The study found there are loopholes within the Nigerian system as compared to those in Malaysia and Pakistan regarding enacted legislation and requirements for capacity to serve on shari’ah advisory boards. Deficiencies also exist with regard to the qualification requirements for management and marketing staff and in the absence of an adequate dispute resolution mechanism. Recommendations arising from the research include suggestion that Nigeria enact specific all-encompassing legislation to regulate Takaful. There is also the need for the creation of a specialized system for resolving Takaful disputes and the requirement of specialized training for Takaful personnel.

This study was conducted to establish the level of knowledge of the management of takaful providers in Nigeria of Islamic financial principles relating to takaful and to determine whether the management operations of the takaful providers are in complete compliance with Islamic financial principles relating to their chosen takaful model. Using qualitative research techniques, the study discovered that the majority of persons chosen to run takaful units were inadequately educated concerning takaful. It was also discovered that some takaful providers had issues with shari'ah compliance to conditions for the validity in Islamic law of their chosen mode of financing. The paper concluded with recommendations to ensure persons dealing in the provision of takaful are adequately educated and mechanisms put in place to regulate takaful operations particularly those pertaining to modes of financing