Participants’ Knowledge and Awareness about Islamic Insurance: A Study on Sammanthurai in Sri Lanka
- August 13, 2020
- Posted by: RSIS
- Categories: IJRISS, Islamic Studies
International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue VII, July 2020 | ISSN 2454–6186
Participants’ Knowledge and Awareness about Islamic Insurance: A Study on Sammanthurai in Sri Lanka
Seinulabdeen Nathira Jahan1, Mohamed Haniffa Mohamed Nairoos2, Mohamed Shafeek Fathima Sulaiha3
1BA(Hons) in Islamic Banking and Finance, South Eastern University of Sri Lanka
2Senior Lecturer, Department of Islamic Studies, FIA, South Eastern University of Sri Lanka
3Lecturers (Prob.), Department of Islamic Studies, FIA, South Eastern University of Sri Lanka
Abstract: Takaful (Islamic insurance) is growing rapidly but it is still behind conventional insurance. Most of the researches reveal the fact that general public is unaware about Takaful and Takaful awareness level is low among general public. Hence, the major objective of this study is to explore the awareness level as well as knowledge level of Takāful. For this purpose, a representative sample of 160 respondents which comprise general Muslim public from Sammanthurai division participated in this survey. Random sampling is used to measure the Takāful awareness and Descriptive analysis used to analyze the data collected from via questionnaires. Furthermore, The finding of this study indicated that out of 160 respondents, only 49 of them are aware of Takāful while 45 respondents do not know about Takāful and others majority of respondents are not conformed about it. Although, Takāful is being offered in Sri Lanka since 1999, its awareness seems to be low. It is recommended that Takāful operators should enhance their marketing strategy and simplify the product features to capture the untouched market.
Key Words: Takāful, Awareness, Knowledge, Sammanthurai, Muslims.
I. INTRODUCTION
Interest and interest- based activities are strictly prohibited by Islam in commercial and financial activities. For this reason, contemporary Muslims should have been making efforts to create alternatives to fulfill their financial needs which have been experiencing in commercial life over recent decades. One of the important parts in the financial sector is insurance service (Ustaoglu, 2015).
The basis of insurance is purely consists the element of interest in both life and general insurance. It will be existed when the policy holder can gets greater compensation then the premium. Investing in interest-based instruments is the primary source of income for conventional insurance (Hassan et al., 2018). Moreover Conventional insurance’s operators currently have no restrictions on where they can invest regardless of what Shari’ah says, operators can invest anywhere they like (Salman, 2014). Riba is prohibited in Islam as mentioned in many places of Qur’an and Sunnah. “Allah has permitted Trade and prohibited Riba (Interest) (Qur’an 2:275).
