Kayadibi, Saim

Majidi, Nuzaihan

Wan M., Wan M. Shahir

English

The International Islamic University Malaysia Repository

Islamic Banking and Finance Against ConventionalChapter 585Takaful As an Alternative to Conventional InsuranceWan M. Shahir b. Wan M., Nuzaihan b. Majidi44and Sairn KayadibiIntroductionWith the presence of the prohibited elements such as Riba,Gharar and Maysir in the conventional insurance, it is thereforecompulsory for Muslim to find the alternative way to providethem with a better security which is in line with Shari"ah. In1979, the first modem concept of Islamic insurance wasintroduced in Sudan which is based on a cooperative modelsimilar to the conventional insurance. Since then, Islamicinsurance market or Takaful market has become a fast-growinginsurance industry and gained its credibility and respect ininternational market. In Malaysia, Takaful industry is governedunder Takaful Act 1984 and Insurance Act 1996. Among theleading Takaful companies in Malaysia are Syarikat TakafulMalaysia Berhad, Etiqa Takaful Berhad and Takaful Ikhlas Sdn.Bhd.Definition Of InsuranceA contract of insurance is a conditional contract that involvestwo different parties in which one party undertakes, againstpremium, to pay to the other party certain amount(compensation) upon a certain event that occurred only due topure risk. This contract is regulated by Insurance ContractsRegulation 1985 under Insurance Contracts Act 1984. It is valid44 Graduate Student, Faculty of Economics and Management Sciences,International Islamic University Malaysia (IIUM), Kuala Lumpur, Malaysia.

Takaful as an alternative to conventional insurance

http://irep.iium.edu.my/20510/1/Takaful_As_an_Alternative_to_Conventional_Insurance.pdf

Takaful as an alternative to conventional insurance

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The International Islamic University Malaysia Repository