Pakistan Research Repository


Ahmad, Sanep (1995) SCHEME DIFFERENTIATION FOR A COMPREHENSIVE AND EQUITABLE TAKAFUL BUSINESS. PhD thesis, International Islamic University, Islamabad.



The prevalent form of Takaful Business in Malaysia is Islamically acceptable since it does not involve prohibited elements such as riba, gambling, uncertainly "no exploitation. However, in its pricing strategy, Takaful Company like conventional insurance companies only considers risk factor which normally refers to the probability of loss or the probability of death. Consequently, the premium rate does not reflect the required values of equity and benevolence from Islamic perspective. Here, the poor and the rich are equally charged while the poor is supposed to bear less burden than the rich. Fairness in this case should be looked within the context of overall ethos of Islamic teachings and should be based on its commitment to human brotherhood. Therefore, a model of Takaful Business which could reflect the required noble values of equity and benevolence from Islamic perspective is needed. In this connection, a Takaful model which directly incorporates income factor along with risk factor is proposed, from which a new premium rate is then suggested. The model shows that the above question could be resolved such that the proposed premium rate reflects the required values of equity, benevolence and brotherhood in Islam. Empirical study further proved that the proposed Takaful model and premium rate are not merely theoretical but also practical and financially feasible.

Item Type:Thesis (PhD)
Uncontrolled Keywords:Takaful Business, Riba, Gambling, Premium rate, Islam, Islamic perspective, Income factor, Risk factor, Insurance, Economic effects, Social security,
Subjects:Social Sciences(g) > Economics (g5)
ID Code:139
Deposited By:Mr. Abdul Qayoom Sohoo
Deposited On:17 Jun 2006
Last Modified:04 Oct 2007 20:59

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