A Conceptual Model of Literature Review for Family Takaful (Islamic Life Insurance) Demand in Malaysia

Abstract

The growing significance of takaful industry (Islamic insurance) in Malaysia is expected to foster sustainable economic growth in Malaysia. Further to this, Malaysia is recorded to be the major player and one of the fastest takaful growth in Southeast Asia. As such, family takaful (Islamic life insurance) segment must be competitive and innovative to increase market penetration and compete with their conventional counterparts. This paper aims to propose a simple yet comprehensive conceptual model by identifying the main determinants that drive family takaful demand in Malaysia. An extensive review of literature available has been carried out to achieve the purpose. Several critical factors namely, agency system (al-wakalah), reputation of takaful operators, products and services, marketing and advertising of takaful products, are found to be the main determinants for family takaful demand.

Factors Affecting Adoption of Takaful (Islamic Insurance) in the Maldives

“…Most of the researches conducted on Takaful during past decade were carried out in Malaysia (Aris et al 2009;Lada et al 2009;Ab.Rahim & Amin 2011;Abdul Aziz et al 2011;Ayinde & Echchabi 2012;Amin 2012;Arifin et al 2013;Husin & Rahman 2013;Kamil & Nor 2014;Arifin et al 2014;Husin et al 2015;Kamarul Ariffin et al 2015;Husin & Rahman 2016;Zakaria et al 2016). Besides these, there few studies done in Middle East and Africa (Echchabi et al 2014;Echchabi & Ayedh 2015) and Handful research conducted in Europe (Echchabi & Echchabi Page 87 2013).However, there are no official publications of any research on Maldivian context related to Takaful and financial industry in general.…”

Innovative Nature of the Takaful Industry in Malaysia: Are We with The Conventional Insurance Industry?

“…The info is obtained from the reliable study, and the study conclusions are fresh and appropriate to the topic at hand. Arifin et al (2013) developed a structured survey to discover the crucial determinants for family Takaful interest amongst Muslim consumers in Malaysia. The study was conducted on 243 Muslim consumers registered in family Takaful with chosen commencing Takaful firms.…”

“…Takaful is based on the origin of Ta'āwun (cooperation) and Tabarru' where the hazard is bestowed collectively by members of a policy (Alhabshi, Sharif, Shaikh Abdul Razak, & Ismail, 2012;Annuar, 2004;Annuar & Bakar, 2010;Arifin, Yazid, & Sulong, 2013;Billah, 2001;Yusof, Ismail, & Naaim, 2011;Faruk, Rahaman, et al, 2015;Kasim, Htay, & Salman, 2016Kassar, 2008;Maysami & Williams, 2006;Muliadi & Feriyanto, 2018;Noor, 2009;Noordin, 2013;Salman, Rashid, et al, 2015;Usmani, 2007;Yazid, Arifin, Hussin, & Daud, 2012;Rahman & Redzuan, 2009). According to Hassan, Kassim, Majdi, and Salman (2018), "Takaful is social and ethical insurance based on the principle of Ta'āwun (cooperation) and Tabarru where the risk is shared collectively by members of a policy.…”

Factors Influencing the Choice of Takaful over Conventional Insurance : The Case of Malaysia

“…It would then lead to main inference that making a gharar (risk) as a consideration in contribution calculation is permissible from Shariah perspective. Arifin, Yazid and Sulong (2013) proposed a simple yet comprehensive conceptual model to identify the main determinants that drive family Takaful demand in Malaysia. Arifin et al (2013) mentioned that there are four important factors that could possibly influence family Takaful demand, i.e.…”

“…Arifin, Yazid and Sulong (2013) proposed a simple yet comprehensive conceptual model to identify the main determinants that drive family Takaful demand in Malaysia. Arifin et al (2013) mentioned that there are four important factors that could possibly influence family Takaful demand, i.e. the agency system (al wakalah), reputation and recommendation, product and services, marketing and advertising.…”