WHAT IS TAKAFUL?

From Wikipedia it says : Takaful is an Islamic concept which is grounded in Islamic muamalat (banking transactions), observing the rules and regulations of Islamic law. This concept has been practised in various forms for over 1400 years. It originates from Arabic word Kafalah, which means "guaranteeing each other" or "joint guarantee". In principle, the Takaful system is based on mutual co-operation, responsibility, assurance, protection and assistance between groups of participants. It is a form of mutual insurance.


In Al-Quran it is mentioned in a few ayats as follows:

1. Basis of Co-operation Help one another in al-Birr and in al-Taqwa (virtue, righteousness and piety): but do not help one another in sin and transgression. (Surah Al-Maidah, Verse 2)

Allah will always help His servant for as long as he helps others. (Narrated by Imam Ahmad bin Hanbal and Imam Abu Daud)


2. Basis of Responsibility The place of relationships and feelings of people with faith, between each other, is just like the body; when one of its parts is afflicted with pain, then the rest of the body will be affected. (Narrated by Imam al-Bukhari and Imam Muslim)


One true Muslim (Mu’min) and another true Muslim (Mu’min) is just like a building whereby every part in it strengthens the other part. (Narrated by Imam al-Bukhari and Imam Muslim)


3. Basis of Mutual Protection By my life, which is in Allah’s power, nobody will enter Paradise if he does not protect his neighbour who is in distress. (Narrated by Imam Ahmad bin Hanbal)


“The basic fundamentals underlying the Takaful concept are very similar to co-operative and mutual principles, to the extent that the co-operative and mutual model is one that is accepted under Islamic Law."

I hope the above sheds light on what Takaful is about. Here, at eTiQa Takaful, it is open to all races and not to Muslims only. The concept here enables the participants themselves to assist each other. In return, participants gets a mudhrabah ( a portion of profit sharing), made from the pool of money invested into Syariah approved counters.

After a certain age, which we call maturity age, the participants will get to withdraw a lump sum of money, inclusive of the dividend sum declared over the years. In between the starting year and maturity period, the participant / next of kin / nominee/ trustee, will receive a covered protection sum in the event the participant suffers from total permanent disability (TPD) or dies. Other form of riders / benefits offered today are hospital allowance, medical card , critical illness claim (over 33 types of listed diseases), etcetera.