Sharīʿah Framework for Pricing Family Takāful Products
This research investigates the Sharīʿah compliance of the pricingelements used in family takāful products. The reviewed literature has revealeda great deal of emphasis on the Sharīʿah aspects of the takāful contract,distribution of surplus, models used, incorporating waqf in takāful, and therelation...
| Authors: | ; |
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| Format: | Electronic Article |
| Language: | English |
| Check availability: | HBZ Gateway |
| Journals Online & Print: | Drawer...
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| Fernleihe: | Fernleihe für die Fachinformationsdienste |
| Published: |
2021
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| In: |
Intellectual discourse
Year: 2021, Volume: 29, Issue: 1, Pages: 89-116 |
| Online Access: |
Volltext (lizenzpflichtig) |
| Summary: | This research investigates the Sharīʿah compliance of the pricingelements used in family takāful products. The reviewed literature has revealeda great deal of emphasis on the Sharīʿah aspects of the takāful contract,distribution of surplus, models used, incorporating waqf in takāful, and therelationship among the parties. Other research has focused on the operationaland technical aspects of takāful such as underwriting, pricing, reserving andrisk management. None of these studies has addressed the Sharīʿah complianceof the pricing elements of family takāful products. Through qualitativeresearch using open-ended interviews as well as content analysis, this researchanalyses the conformity of family takāful pricing mechanism with the Sharīʿahprinciples of price-setting (tasʿīr). The research findings indicate that theassumptions of mortality and morbidity are Sharīʿah compliant based onthe principles of ibāḥah (permissibility), maṣlaḥah (public interest), istiqrāʾ(induction) and ʿurf (custom). However, the investment returns assumption isnot quite fair to the shareholders should there be a loss in the investment. Theresearch also indicates that the concept of time value of money is a Sharīʿahcompliantelement that can be used to price family takāful products. Further,the findings highlight that the pricing elements such as health condition aredeemed unfair by some practitioners. Similarly, adding an extra loading to thecontribution because of family medical history should not be taken for granted. |
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| ISSN: | 2289-5639 |
| Contains: | Enthalten in: Intellectual discourse
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