62 research outputs found

    Shariah compliance assessment of construction takaful claims for loss and damage

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    Incessant and ascendant increases in the interest to adopt Shariah concepts in commercial transactions has encouraged business entities including contractors to employ Shariah compliance products. Currently, contractors are inclined to employ Contractor’s All Risks (CAR) Takaful to insure their works during construction. Upon any occurrence of specified risks to the construction works, contractors may submit claims and the monies received therefrom would be utilized to recover the damaged works. However, past studies claimed that the practice in assessing claims in takaful has deficiency in terms of its legitimacy from the Shariah perspectives. The current practice in assessing claims for construction works loss and damage lack of transparency and accountability with absence of standard guideline. Consequently, a study was conducted with the key objective to identify legitimacy from the Shariah perspectives in assessing claims for construction works loss and damage. The methodology used for the study combined three (3) key data sources, which are (i) review on primary religious documents i.e. Quran and hadith and practice of the assessments of construction takaful claims in Malaysia; and (ii) semi-structured interview with eight (8) experts in the fields of takaful and insurance, construction industry, and Shariah knowledge areas. The outcome of the study suggests that (i) there are various methods used by the experts in assessing claims for construction works loss and damage, and (ii) the current practice in assessing takaful claims for construction works loss and damage do not adhere fully to the requirement of the Shariah. This paper is expected to produce a summary of the legitimacy from the Shariah perspectives in making assessment for construction works loss and damage. Further research is recommended in order to develop a Shariah compliance standard procedures for the assessment of takaful claims for construction works loss and damage

    Theoretical and practical issues and challenges in takaful for construction works

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    According to the Malaysia Economic Report 2015/2016, the construction industry of Malaysia is estimated to contribute some 8% to the nation’s GDP in year 2015. Consequently, activities related to construction are widespread, hence the potential of loss and damage they entail. Such potential loss and damage of construction works require protection and the most common type of insurance in compliance with the Shariah is Contractor’s All Risks (CAR) Takaful. The CAR Takaful continuously recorded significant performance with 15% increment yearly. Critically, despite substantial growth, the penetration of CAR Takaful industry is far below its potentials. A wide range of issues and challenges concerning construction takaful are being debated by Shariah scholars and technocrats. This chapter aims to review the theory and practice of takaful in general and CAR Takaful specifically, with the objective to provide better understanding of takaful and CAR Takaful and to highlight issues and challenges surrounding thereto. The outcome of the review suggests that the takaful and CAR Takaful are plagued with a host of theoretical and practical issues and challenges including the Shariah legitimacy in the practice of takaful and CAR Takaful, ambiguous regulatory framework, lack of transparency and accountability and issues related to governance. These issues and challenges require urgent attention or else they may not augur well for the future of the takaful and CAR Takaful industry

    Classification and types of risk for properties belonging to low-income and poor individuals in Malaysia

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    In Islam, the presence of risk is not only acknowledged but steps need to be taken to manage it properly through the process of risk management. One of the processes is the identification of risk which involves classification and types of risk. Specifically, in the development of properties, the presence of risks is inevitable. Improper management of risk especially for properties belonging to the low-income and poor individuals could mean that they will suffer from a bigger loss and poverty. Existing literature has shown and identified the inherent risks in the development of properties in Malaysia. However, risks exposed to in the development of properties belonging to the low-income and poor individuals in Malaysia are not properly identified. Consequently, a study is conducted to identify risks exposed to in the development of properties belonging to low-income and poor individuals in Malaysia. This study combines literature review and interview with experts and practitioners from various fields such as mua’malat, risk management, construction, developers, Majlis Agama Islam Negeri-Negeri (MAINs) and contractors. Findings from this study suggested that i) 94 risks were identified related to the development of properties belonging to low-income and poor individuals in Malaysia, and ii) Shariah elements i.e mua’malat and its requirements are included as one of the risks in the development of properties belonging to low-income and poor individuals in Malaysia. The findings become the basis and considered significant in assisting authorities and related organizations to understand and address risks accordingly and may assist the future development of a comprehensive Shariah compliance risk management for the development of properties in Malaysia

    Strengthening the maqasid al-shariah contents in undergraduate quantity surveying programme at KAED,IIUM

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    Quantity Surveying is among the key professions that are involved in the provision of services related to the built environment. Quantity Surveyors provide services in the critical areas of procurement, estimating, contract documentation and post contract administration of construction projects and built assets. In the context of Islamization of human knowledge (IoHK), recent studies suggest that the Bachelor in Quantity Surveying Programme (BQS) (Honours) at the Kulliyyah of Architecture and Environmental Design (KAED), International Islamic University Malaysia (IIUM) has content that include the five key components of the maqasid al-shariah namely preservation of (i) faith, (ii) self, (iii) intellect, (iv) lineage, and (iv) property. However, the studies also indicate that the programme’s maqasid al-shariah contents appear to be un-evenly distributed with “faith” and “lineage” being the weakest while “intellect” is the highest. Consequently, efforts are being made in attempting to achieve a more balanced programme. This paper reports on a study to seek ways on how to achieve a more balanced BQS (Honours) programme at KAED, IIUM in the context of the maqasid al-shariah. The study focusses to propose contents of the BQS (Honours) programme courses in order to increase the “faith” and “lineage” components therein and employed a combination of literature review, content analysis of the programme structure and course outlines of the BQS (Honours) programme at KAED, IIUM and a series of detail discussions among BQS lecturers. Key findings from the study suggest that the BQS (Honours) programme at KAED IIUM has potentials towards achieving a more balanced maqasid al-shariah among the five key components and the types of courses and topics to be incorporated into the programme have been identified. The research outcome, if appropriately applied, would facilitate preparing graduates with the necessary knowledge and understanding of the maqasid al-shariah within the field of quantity surveying. This therefore should facilitate them in performing their roles as professionals related to the built environment and as the Earth’s khalifah

    Empowering Wakaf and Zakat in the Provision of Affordable Housing through Collaborative Procurement

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    Wakaf and zakat are the two most essential tools for assisting the poor and needy Muslims to have access to better living conditions. However, in the provision of affordable housing, efforts by the wakaf and zakat authorities are often hampered by constraints such as in the availability of funding and expertise. The purpose of this paper is to propose a conceptual model of collaborative procurement to empower wakaf and zakat in the provision of affordable housing for the poor and needy. It is contended that through collaborative procurement wakaf and zakat authorities would have better access to resources especially funding and technical expertise. The paper, an outcome of robust desk research and discussions with experts, describes the concepts of wakaf, and zakat and their efforts to help the poor and needy including in the provision of affordable housing and collaborative procurement. Besides, a collaborative procurement model comprising of wakaf and zakat authorities and private property developer has been developed and herein proposed. The paper highlights issues and constraints, including those related to the Shariah. The research outcome, concerning the proposed collaborative procurement model, contributes significantly towards empowering wakaf and zakat in the provision of affordable housing for the poor and needy

    Zakat and wakaf funded housing for the poor and needy – an analysis of the zakat and wakaf authorities roles from the authorities’ perspectives

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    This paper concerns the provision of affordable housing for the poor and needy Muslims through zakat and wakaf funding. The study’s objectives are to determine whether zakat and wakaf resources are employed therein, examine the roles of the zakat and wakaf authorities, and identify constraints and the ensuing strategies. The study was carried out through desk research and interviews with representatives of selected zakat and wakaf authorities. Key findings from the study are that zakat and wakaf are involved in the provision of affordable housing for the poor and needy Muslims and that their funds have been employed therein. However, their roles are dissimilar, therefore, each authority has its own modus operandi. In addition, both zakat and wakaf authorities have constraints in the availability of expertise to undertake the procurement of housing development and they address this problem through collaborative working styles, with each other, and with private property developers
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