1.0 INTRODUCTION
Islamic insurance, also known as takaful is a product and services that guarantee and give protection toward risk to their consumers according to Islamic principle. TheIslamic insurance and conventional insurance both using the same conceptwhich using concept of guarantee. There were also different in between takaful and conventional where takaful is based on shariah compliant while conventional is based on the principle of risk taking and speculation. Muslim jurists generally accepted that the concept of insurance does not contradict with shariah principle and also was accepted by Islam and the Holy Prophet. According to Islam and insurance, (2007), Islam calls for the protection of certain basic rights which are the right to protect the religion, the right to protect the life, the right to protect dignity or honour, the right to protect the property and the right to protect the mind.
Nowadays, the public more concern about their safety and protection whether for their own self or family. Thus, the consumer must understand the concept before purchasing insurance and choosing the suitable product which give benefit to them. There were many differences between Islamic and conventional insurance and by these differences make the consumer have their own understanding and opinion toward the insurance product. An insurance agent and industry be the main role in making the consumer to be more knowledgeable and understanding of each product of insurance.
TAKAFUL: A BRIEF OVERVIEW
Takafulhas existed since 215 BC and been practiced for over 1400 years. The word of takaful originates from Arabic term which is Kafalah. According to General Tkaful, (2008), it means guaranteeing between each other or joint guarantee betwe...
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Violent Jihad as a struggle against one’s enemies has its root in [these] situations. When the Islamic religion spread over the region, Jihad became a religious tenet and assumed the form of a peaceful, internal struggle to strive for the good and reject the evil in one’s action. Violent, external conflict was never r...
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Islam is a monotheistic and Abrahamic religion alongside Judaism and Christianity. It is currently the second largest religion in the world today. Its beliefs come from the Qur'an which literally means "the recitation" which is believed to be a literal transcription of the word of God. Its main prophet is named Muhammad who began Islam by speaking with the angel Gabriel in a cave during his meditation and then acting as an instrument of God to help write the Qur’an. Muhammad then spread Islam to the scattered tribes of Arabia by becoming the leader of Yathrib and using his wonderful leadership abilities to then grow his influence over virtually all of Arabia. Muhammad is known by Muslims to be the seal of the profits because no profits after Muhammad should be considered legitimate. Muhammad also left behind the Hadith or “tradition” which is a collection of writings compiled of reports of Muhammad’s actions as leader of Yathrib. These reports are used as a more specific code of ethics in day to day life and from these reports the 5 Pillars of Islam are derived (Smith 160). Although Islam shares many similarities to Judaism and Christianity it is often viewed in the US with hate derived from preconceived notions following the attack on September 11th 2001. This paper seeks to provide an overview of Islam’s history as well as its two major sects and 5 main pillars to remove preconceived notions and provide a glance into the minds of the Islamic people.
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I would have to admit that at the age of 20, I still knew very little about insurance. Coming from a different country, I had no idea that one could insure belongings or people. Today, I know that insurance acts as a safety net. It is there to help cope with the unanticipated and sometimes even the loss of a beloved one. The general notion behind insuring your treasured possessions and cherished ones can be of a vast benefit at the time of a tragedy. As we grow older, we actively begin to concern ourselves more about the future of our family rather than the latest trends in fashion or gadgets.
The basic concept of insurance is the transfer of risk from one entity to another through certain conditions. Health insurance is no different, only the entities mentioned are consumer or the patient and the insurance company. In the health insurance concept, a premium is paid by the individual to the company for a year and the insurance company has to pay for the cost of healthcare for that individual. Hence the risk for the consumer is transferred to the insurance company.
Khashan, Hilal. “The New World Order and the Tempo of Militant Islam.” British Journal of Middle Eastern Studies. Volume 24, Issue 1 (1997. 5), 5-24.
Insurance is important because if you buy something and it ends up being lost then you can get it back and not waste your money on it. If you lose something and don’t get it back, then you just lost a bunch of money. This is also the relationship between insurance and successful financial management. You have to make sure you don’t lose money and save and plan.
For the contrary the loading change (fee to cover the incurred administrative expenses) can be expensive. Also, the insurance sometime fails to meet demand providing limited protection, this insurance shortage can lead to ineffective insurance regulations. As well as, for consumer with minimum loss experience, their premium will be high, because their probability of loss is high.
In 1979, the first islamic insurance (takaful) company was established. All muslims at that time cannot purchase the conventional insurance products as it involed interest-based transactions,uncertainty, and gambling whi...
Islamic inheritance structure is consisting of institutions which are faraid, bequest and inter vivos gift (hibah). Faraid means the Islamic law of succession, which definitely, is the leader of the Islamic inheritance arrangement. It is meant to defend descendants’ rights with instruction of the fixed entitlements of authorized heirs. Faraid may seem to be an undeniable, given set of rules but the equality of the obligatory rules of faraid exists in the form of bequest (wasiyyah) and inter vivos gift (hibah). The difference between wasiyyah and hibah lies in the fact that each transmission ways and means of the property is determined at the difference country and subject to difference boundaries. In regard of the religion, if a transfer took place between the livings, it is known as hibah while if it took place upon the death, it is called a wasiyyah or bequest. Faraid and wasiyyah has an inherent limitation according to ulama and traditional Islamic defenders, but in Hibah there is no such limitations exist because the owner can transfer of all rights in the property himself during his life. However, Faraid and Wasiyyah can only distributed after the death of the donor.
Lastly the challenges faced by the Islamic banking is the lack of unity in giving Shariah’s view. Therefor, it gives problem to the agencies as there are different methodologies that are being proposed when elaborating the law. In order to counter this challenges, agencies need to take initiatives of choosing the view which is parallel or nearly parallel with what was underlined by the Al-Quran and As- Sunnah.