Awareness and Knowledge of Takaful in Malaysia: A Survey of Malaysian Consumers

Abstract

Insurance, nowadays, is no longer a luxury rather a necessity. Government regulations and employment are two very important factors that contribute to the huge overall growth of the insurance industry because they force general public to buy it. The concept behind conventional insurance is contrary to the principles of Islam and socio-ethical perspective. The purpose of Shari'ah is to create and maintain a harmonious social environment by moulding our conducts in all aspects of our ritual and daily life.Takaful industry remains to be relevant even after three decades of its introduction due to the continuous demands from the multiracial and multi-ethnic participants from various backgrounds. The said industry celebrates the contributions of their stakeholders, namely the Takaful operators, Shari'ah advisors and the participants or customers. Additional credit for the progressive development of Takaful industry goes to the consistent guidelines from the regulators. However, one factor that hinders further development of Takaful industry is the lack of awareness of its presence and purpose in Malaysian market. Therefore, this paper was designed to examine the knowledge and awareness of Takaful among Malaysian consumers in Malaysia by collecting primary data through survey questionnaires. Out of the 600 questionnaires that were sent to consumers in greater Malaysia i.e. Kuala Lumpur and Selangor, we received 503 questionnaires. Random selection was used to select the sample from the known population. The findings show that out of the 503 respondents, 124 have no knowledge of Takaful and 45% are not aware that Takaful policy holders share risks mutually. Also, 33.2, %, 38.8% and 37.2% do not know that Takaful is free from gambling, uncertainty, and interest.70.2% respondents, however, think that Takaful products comply with Shari'ah.

Revisiting the corporate image through service quality and relationship marketing: an empirical evidence from Malaysian and Saudi Arabian Takaful customers

“…On the contrary, relationship marketing is one of the marketing approaches that concentrate on customer orientation to create long-lasting relationships (Berry, 1995). Marketers have to be customerfocused and provide services perceived as "Islamic", especially with the current challenging market environment and customer demands for quality services (Hassan et al, 2018). Indeed, ethics seem to be the main agenda of many marketing issues (Piercy and Lane, 2007), but not many of these studies have included religious elements in their realm (Muhamad and Mizerski, 2010).…”

“…Consequently, previous studies on Takaful have primarily focused on its concept, operations and adoption. A plethora of research has investigated customers' perceptions and affecting factors towards Takaful products (Ab Rahim and Amin, 2011;Amin, 2012;Kantakji et al, 2020;Muhamat and McIver, 2019;Salman and Hassan, 2020;Alkhan and Hassan, 2020b;Md Husin and Haron, 2020), while others have examined the determinants of demand, customer attitudes towards Takaful participation and levels of awareness (Hassan et al, 2018;Maizaitulaidawati and Asmak, 2016).…”

Students’ Understanding towards the Objectives and Concepts of Takaful

“…It serves a crucial and vital function in the financial sector. Takaful is the optimal alternative for anybody seeking financial protection against unexpected tragedy, since it provides more additional value than insurance (Hassan et al, 2018). Therefore, it is interesting to examine the students' knowledge and understanding towards the ultimate objectives and concept of Takaful.…”

Sustainability & Successful Takaful Agents: What Matters?

“…The benefit of having life insurance is the policyholders entitle to guarantee the family members' financial wellbeing, resorting to the unsettled financial obligation immediately after he died (Zakaria et al, edging of all aspects of life in this Islamic ritual. Shariah compliances are introduced to design a pleasant community upbringing among Muslims (Hassan, Salman, Kassim, & Majdi, 2018). As a result, Takaful manages to be relevant and significant in the international market for the past four decades of its introduction which started in Sudan in 1979 (Lim, Idris, & Carissa, 2010).…”