December 2017
Information, Tips, Tricks About Insurance
List of insurance companies in Bangladesh:

List of Insurance Companies in Bangladesh and Top 10 Insurance Company in Bangladesh

Public Sector (Life)
• Bangladesh Jiban Bima Corporation

Public Sector (Non-life)
• Bangladesh Sadharan Bima Corporation

Private Sector (Life)
• Surja Life Insurance Company Ltd.
• MetLife Bangladesh (Foreign Company)
• Baira Life Insurance Company Ltd.
• Delta Life Insurance Company Ltd.
• Farest Islami Life Insurance Co. Ltd.
• Golden Life Insurance Ltd.
• Homeland Life Insurance Company Ltd.
• Meghna Life Insurance Company Ltd.
• National Life Insurance Company Ltd.
• Padma Islami Life Insurance Company Ltd.
• Popular Life Insurance Company Ltd.
• Pragati Life Insurance Ltd.
• Prime Islami Life Insurance Company Ltd.
• Progressive Life Insurance Company Ltd.
• Rupali Life Insurance Company Ltd.
• Sandhani Life Insurance Company Ltd.
• Sunflower Life Insurance Company Ltd.
• Sunlife Insurance Company Ltd.
• Zenith Islami Life Insurance Ltd.
• Mercantile Islami Life Insurance Ltd.
• NRB Global Life Insurance Company Ltd.
• Guardian Life Insurance Ltd.
• Chartered Life Insurance Company Ltd.
• Best Life Insurance Company Ltd.
• Protective Islami Life Insurance Co. Ltd.
• Sonali Life Insurance Co. Ltd.
• Sawdesh Life Insurance Co. Ltd.
• Diamond Life Insurance Co. Ltd.
• Alpha Islami Life Insurance Ltd.
• Trust Islami Life Insurance Co. Ltd.

Private Sector (Non-Life)
• Agrani Insurance Company Ltd.
• Asia Insurance Ltd.
• Meghna Insurance Company Ltd.
• Asia Pacific Gen Insurance Co. Ltd.
• Bangladesh Co-operatives Ins. Ltd.
• Bangladesh General Insurance Co. Ltd.
• Bangladesh National Insurance Co.Ltd.
• Central Insurance Company Ltd.
• City General Insurance Company Ltd.
• Continental Insurance Ltd.
• Crystal Insurance Company Ltd.
• Desh General Insurance Company Ltd.
• Eastern Insurance Company Ltd.
• Eastland Insurance Company Ltd.
• Express Insurance Ltd.
• Federal Insurance Company Ltd.
• Global Insurance Ltd.
• Green Delta Insurance Co. Ltd.
• Islami Commercial Insurance Co. Ltd.
• Islami Insurance Bangladesh Ltd.
• Janata Insurance Company Ltd.
• Karnaphuli Insurance Company *Ltd.
• Mercantile Insurance Company Ltd.
• Nitol Insurance Company Ltd.
• Northern Gen.Insurance Company Ltd.
• Peoples Insurance Company Ltd.
• Phonix Insurance Company Ltd.
• Pioneer Insurance Company Ltd.
• Pragati Insurance Ltd.
• Paramount Insurance Company Ltd.
• Prime Insurance Company Ltd.
• Provati Insurance Company Ltd.
• Purabi General Insurance Company Ltd.
• Reliance Insurance Limited.
• Republic Insurance Company Ltd.
• Rupali Insurance Company Ltd.
• Sonar Bangla Insurance Company Ltd.
• South Asia Insurance Company Ltd.
• Standard Insurance Ltd.
• Takaful Islami Insurance Ltd.
•  Dhaka Insurance Ltd.
• Union Insurance Company Ltd.
• United Insurance Company Ltd.
• Sena Kalyan Insurance Company Ltd.
• Sikder Insurance Company Ltd.
Top 10 Insurance Company in Bangladesh:
1. American Life Insurance Co
2. Jiban Bima Corporation
3. Delta Life Insurance Co Ltd
4. Popular Life Insurance Co Ltd
5. Shandhani Life Insurance Co Ltd
6. Meghna Life Insurance Co Ltd
7. Takaful Islami Insurance Ltd
8. Pragati Insurance Co Ltd
9. Padma Life Insurance Co Ltd
10. Sunlife Insurance Co Ltd

Insurance Development and Regulatory Authority of Bangladesh (IDRA) is the only government body for regulating and developing the insurance sector of Bangladesh since 2010.

The Parliament of Bangladesh on 3 March 2010 has passed two insurance laws in a bid to further strengthen the regulatory framework for the insurance industry. 

77 insurance companies have been operating in the country. The companies are to be regulated under comprehensive laws and guidelines, and to be supervised by IDRA. The IDRA Act 2010 has paved the way for better regulation of the sector by reducing business risks, and by harmonizing local and international insurance laws for the Economy of Bangladesh. IDRA attempts to protect the interest of insurance policy holders, beneficiaries and ensuring stability of the insurance sector.Two state-owned insurers -Sadharan Bima Corporation (SBC) and Jiban Bima Corporation (JBC) are also regulated by IDRA.
Information, Tips, Tricks About Insurance
What is Insurance?

Insurance Contract and Functions of Insurance

Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. ... A person or entity who buys insurance is known as an insured or policyholder.

Insurance Contract
In insurance, the insurance policy is a contract (generally a standard form contract) between the insurer and the insured, known as the policyholder, which determines the claims which the insurer is legally required to pay. 

Some definition of insurance Contract 
1. Insurance may be define as a contract where by one party agrees to indemnify the other party against a loss which may arise or to pay a certain sum of money on the happening of a certain event, in return of compensation called premium -M.K. Ghosh & A.N. Agorwala

2. Insurance is that in which a sum of money as a premium is paid in consideration of the insurer’s incurring the risk of paying a large sum upon a given contingency - M.N. Mishra 

Characteristics of insurance contract:

1. Two parties are involved in insurance contract. One party transfer the risk of his life and property to another and the other party gives assurance to bear the risk.
2. To transfer risk, the insured pays premium to the insurer. That means, price of risk taking is called premium.
3. Terms and condition of the policy are enumerated in insurance contract. 

Functions of Insurance
The functions of insurance can be studied into two parts. Such as follows: 

a. Primary Functions: The primary functions of insurance are as follows:
i) Insurance provides Certainty: Insurance provides certainty of payment at the certainty of loss. The uncertainty of loss can be reduced by better planning and administration. Insurance removes all these uncertainty and the assured is given certainty of payment of loss. The insurer charges premium for providing the said certainty.

ii) Insurance provides Protection: The main function of the insurance is to provide protection against the probable chances of loss. The time and amount of loss are uncertain are at the happening of risk, the person will suffer loss in absence of insurance. The insurance guarantees the payment of loss and thus protects the assured from sufferings.

iii) Risk-Sharing: The risk is uncertain, and therefore, the loss arising from the risk is also uncertain. When risk takes place, the loss is shared by all the persons who are exposed to the risk.

b. Secondary Functions: Besides the above primary functions the insurance works for the following functions:
i) Prevention of Loss: The insurance joins hands with those institutions which are engaged in preventing the losses of the society because the reduction in loss causes lesser payment to the assured and so more saving is possible which will assist in reducing the premium.

(ii) Insurance provides Capital: The insurance provides capital to the society. The accumulated funds are invested in productive channel. The death of capital of the society is minimized to a greater extent with the help of investment of insurance. The industry, the business, and the individual are benefited by  

iii) Insurance improves Efficiency: The insurance eliminates worries and miseries of losses at death and destruction of property. The carefree person can devote his body and soul together for better achievement. It improves not only his efficiency, but the efficiencies of the masses are also advanced.

iv) Insurance helps Economic Progress:  The insurance by protecting the society from huge losses of damage, destruction and death, provides an initiative to work hard for the betterment of the masses. The next factor of economic progress, the capital, is also immensely provided by the masses. The property, the valuable assets, the man, the machine and the society cannot lose much at the disaster.
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Principles of Insurance
1. Disclosure of materials.
2. Insurable interest.
3. Principle of indemnity.
4. Principle of subrogation.

Principles of Insurance and Elements of Insurance Contract

1. Disclosure of materials: There are two parties involved in insurance contract. These are Insured and Insurer. Before entering into the insurance contract both parties have the responsibilities to disclose all information relating to the insurance contract. A material fact is one which affects the judgment or decision of both parties in entering into the contract. You may or may not enter into the contract. Insured and insurer are both the same responsibilities relating to the insurance contract. Here one party is reliable to another party hundred percent. This is also known as utmost good faith. 

2. Insurable Interest: Insurable interest means pecuniary/ monetary/ voluntary/ financial interest in the subject matter of insurance of the insured is known as insurable interest. Existing of insurable interest is different in different types of insurance.
a) Life Insurance: Insurable interest should be present when you take the policy.
b) Marine Insurance: Insurable interest should be present when you make the claim. 
c) Fire Insurance: Insurable interest should be present when you take the policy and make the   claim.

3. Principle of Indemnity: Insurable contract is a contract of indemnity. Insurance will never allow making any profit but insurance will simply to make good the loss. Two terms are important here.
a) Over Insurance, and
b) Under Insurance.
- Over Insurance: To disclose over insurance the principle of indemnity is an essential feature of an insurance contract, in absence whereof this industry would have the hue of gambling and the insured would tend to effect over insurance and then intentionally cause a loss to occur so that a financial gain would be achieved. So, to avoid this intentional loss, only the actual loss becomes payable and not the ensured sum (which is higher in over insurance).
- Under Insurance: If the property is under insured, i.e., the insured amount is less than the actual value of the property insured, the insured is generally regarded his own insurer for the amount if under insurance and in case of loss he or she  shall share the loss himself or herself.

4. Principle of Subrogation: Principle of subrogation is the corollary to the principle of indemnity. The doctrine of subrogation refers to the right of the insurer to stand in the place of the insured after settlement of a claim, in so far as the insured’s right of recovery from an alternative source is involved. If the insured is in a position to recover the loss in full or in part from a third party due to whose negligence the loss may have been precipitated, his right of recovery is subrogated to the insurer on settlement of the claim. The insurers thereafter recover the claim from the third party. The right of subrogation may be exercised by the insurer before payment of loss.

Elements of Insurance Contract
1. General Contract
 Agreement (Offer and acceptance)
 Legal Consideration
 Competent to make contract
 Free consent
 Legal object

2. Insurable Interest

3. Utmost Good Faith

 Material Facts
 Full and True Disclosure
 Duty of Both the Parties
 Facts need not be disclosed by the insured

4. Principle of Indemnity
 To discourse over insurance 
 To avoid an Anti-social Act
 To maintain the premium at Low-level

5. Doctrine of Subrogation
 Corollary to the principle of Indemnity
 Subrogation is the Substitution
 Subrogation only up to the amount of payment
 The Subrogation may be applied before payment
 Personal Insurance

6. Warranties

7. Proximate Cause

8. Assignment of Transfer of Interest

9. Return of Premium 
 By Agreement in the policy
 For reasons of Equity
 Over-insurance by double insurance
Information, Tips, Tricks About Insurance
Insurance misconception among Muslim Ummah emanates from the religious doctrine of Tawwakkul (Trust on Allah (SWT) about fate). Muslim population believes that the insured puts a trust on the insurance company to protect him against an unexpected loss instead of putting  his  trust  on  Almighty  Allah  (SWT)  (Billah,  undated  (e)).  

Shariah Position About Misconception of the Concept of Insurance

Misunderstanding  the concept of fate (as associated with insurance) has made Muslim’s beliefs to deviate further by the belief that the future is   in the hand of Allah (SWT) where Muslim are faced with fatalistic mentality by putting themselves in the doctrine whether one is rich or poor, happy or sad, it is predestined by Allah (SWT) which is in line with the saying of noble Qur’an that  goes…but on Allah (SWT) puts your trust (Tawakkul) if you have faith (Qur’an; 5:26) (yusif, Radan, Ismail & Yakub, 2011).

This is a good dealing with luck. In fact; efforts and prayer should precede this kind of belief. Thus, for a long time, the misconception has been associated with insurance and as a result any  effort  to  decide  on  risk  management  strategy  to  insure  the  asset  or  life  has  been considered against the fate or will of Allah (SWT) (Iqtisad Al-Islamy, 2003 in Akhtev, Akhtar & Jafri, undated; yusif, Radan, Ismail & Yakub, 2011 and Kalif, 2006).

Of course, it is true that only Allah (SWT) knows one’s future and fate, but it is reiterated that Muslim should strive to achieve the goodness in this world and the hereafter (Qur’an; 2:201). Submission to the will of Allah (SWT) has a positive effect on human behavior for it will lead to peace and contentment. 

Undoubtedly one has to submit every single thing to Allah (SWT) but is supposed to be after his hand stretch out to do the best effort as he can, to change himself, so that he would be able to manage and to cope with unforeseen calamities and misfortune (Akhter, etal, undated). In his tradition, the Holy Prophet (SAW) was reported to have asked a Bedioun who had left his camel untied, “Why do you not tie your camel? The Bedouin answered; “I put my trust in Allah (SWT)”, the Prophet (SAW) then said; “tie up your  camel  first,  then  put  your  trust  in  Allah  (SWT)”  (Sunan  Al-Tirmizi  vol.  4,  No 2517:668). The story of Prophet Ya’qub in the noble Qur’an shows similar dimension as it says; “further he said; O my sons! Enter not all but one gate. 

Enter ye by different gates. Not that I can profit you ought against Allah (SWT) with my advice. None can command except Allah (SWT): on Him do I put my trust; and let all that trust put their trust on him”. (Qur’an;12:67). We Muslim, however, should put our trust on to Allah only after meticulous planning by best utilization of all the available resources like Takaful products. 

Various  sources  of misconceptions  explored  by scholars (Isa  & Dandago,  2010;  Billah, undated (e) and Kalif, 2006) among others are; that all insurance is a form of a gambling; that all dimension of insurance seek to maximize profit which takes the benefits away from the policy holders or participants; that all Takaful operators are the same; that it is safer to say “I do not need Takaful (insurance) and finally, Takaful is contrary to the principles of Mirath and Wasiyah especially in the case of family Takaful plan.

Therefore, in response to the misconception, many Qur’anic injunctions and Sunnah have already clarified some issues. Besides, an Islamic model of insurance is a mutual agreement and transaction similar to the Allah (SWT) saying: “o ye who believe! Do not misappropriate your property among yourselves in vanities but let there be among you traffic and trade by mutual goodwill! (Qur’an; 4:29) Takaful plan encourages Muslim Ummah to strive hard in overcoming difficulties in their lives where the Holy Prophet (SAW) have said to that effect: as narrated by Abu Huraira (R.A), the Holy Prophet (SAW) said; “whosoever removes a worldly grief from a mu’min, Allah (SWT) will take away from him one of the grieves of the hereafter. 

Whosoever alleviates a needy person, Allah (SWT) will alleviate from him in both the world and the hereafter” (Sahih Muslim in a Nawawi: 114).  Takaful is also similar to the principle of al-wadiyah (deposit) whereby two parties engage themselves in an agreement in which one of them deposits money to the other as a trust or Amanat for the purpose of safe keeping as Allah (SWA) says, “...verily Allah (SWT) commands you to render back trust to those to whom they are due… (Qur’an; 4:58).

In conclusion, however, Takaful is aimed at eliminating hardship from one’s life which is in line with the Allah (SWT) saying,”...Allah (SWT) intends easy life for you while He does not want to put you to difficulties… (Qur’an; 2:185). In the same vein, the Holy Prophet (SAW) said as narrated by Safwan Ibn Salim (R.A); the Holy Prophet (SAW) said: “the one who looks after and works for a widow and for a poor person is like a warrior fighting for the cause of Allah (SWT) or like a person who fast during the day and prays overnight… (Sahih al-Bukhari, vol 8, No 35:23). 

The Holy Prophet (SAW) finally does advice as narrated by Sa’ad Ibn Abi Waqqas (R.A) that “it is better for you to leave your offspring wealthy than to leave them poor asking others for help…” (Sahih al-Bukhari vol. 8, No. 725: 477)
Information, Tips, Tricks About Insurance
Takaful is a shariah complied product. Its principles, guidelines, rule and regulations have originated from the Islamic legal system whose sources of authority emanated from Al’ Qur’an and Hadith. 

Sharia Justification for Islamic Insurance (Takaful) Practice

That is why in the noble Qur’an, it was stated that “O you who believe! Obey Allah (SWT) and obey the Prophet (SAW) and those charged with the authority among you. If you differ in anything among yourselves, refer it to Allah (SWT) and His Messenger, if you do believe in Allah and the last Day. That is best and most suitable for final determination;” (Qur’an: 4:59). 

This is a declaration in the noble Qur’an which shows that the general sources of Islamic Law (Takaful inclusive) are the noble Qur’an, and sunnah (tradition of Holy Prophet).In another verse of the noble Qur’an, its (Qur’an) own definition is deduced which states: “It is a plain statement to man, a guidance and instruction to those who fear Allah (SWT)… (Qur’an: 3:138). 

Sunnah, however, is a practice of or tradition of Holy Prophet as he is the best interpreter of the noble Qur’an. Other sources of Shari’ah Law can be from the practice of the companions of the Holy Prophet (S.W.A) followed by the Ijtihad that is consensus of opinions, among the Islamic scholars as instructed by Allah (SWT) which says to that effect “… think deeply O you who understand… (Qur’an: 59:2) Ali, (2000:257). 

The institution of Islamic insurance is built on the basis of mutual cooperation, responsibility and mutual protection; among participants. Many Islamic injunctions can be forwarded to that effect. On the basis of mutual cooperation, the noble Qur’an says “Help one another in furthering virtue and God – Consciousness (At – Taqwa) and do not help one-another in furthering evil and enmity (Qur’an 5:2). In the Holy Prophet’s (SWA) Hadith; it was reported that Prophet said “Allah (SWT) will always help His servant for as long as he helps others (Narrated by Imam Ahmad Ibn Hambal and Imam Abu Daud). 

On the basis of responsibility, however, the Holy Prophet’s Hadith states that 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 also be affected (Narrated by Al-Bukhari & Muslim). More so, the Holy Prophet said” One true Muslim (Mu’min) and another true Muslim is just like building whereby every part in it strengthens the other part (Narrated by Al-Bukhari & Muslim). 

To establish the basis of mutual protection among members, the Holy Prophet (SAW) in his Hadith, warns that “by my life, which is in Allah’s power, nobody will enter paradise if he does not protect his neighbor who is in distress (Narrated by Imam Ahmad Ibn Hambal). These fundamentals are what have constituted the core tenet of the business of Takaful (SECP, 2010).

It has, for long, been justified that the Muslim Ummah should work hard in order to be able to change their conditions as can be seen in the noble Qur’an “…verily never shall Allah (SWT) change the condition of people until they change it themselves (with their own souls) (Qur’an, 3:11). This is in line with aim of Takaful which is to change the condition of Muslim Ummah through sound financial planning and risk management that is inherent in human life to conform with the wishes of Allah (SWT) to humanity as stated in Qur’an 

verse,”  Allah  (SWT) intends  you  to  enjoy  an  easy life.  He does  not  wish  you  to  face hardships… (Qur’an, 2:185).

As noted that the core value of Takaful that distinguishes it from conventional insurance include: avoidance of Riba (interest), avoidance of gharah (uncertainty) and avoidance of Maisir (gambling). 

These are vitiating elements of contract in Shari’ah and are forbidden in Qur’an and Sunnah. Allah (SWT) warns Muslim against Riba (interest) as said “...Allah (SWT) permits trade and transaction while he prohibits anything involving usury (interest)… (Qur’an 2:275), Takaful transaction is made to be free from element of uncertainty to comply with the Holy Prophet (S.A.W) saying as reported by Said Ibn al-Musayyib (R.A) that verily the  Holy  Prophet  (S.A.W)  forbids  Muslim  from  uncertain  transaction  (Muwatta  Imam Malik). 

Allah (SWT) also said “O ye who believe! Intoxicants and gambling, sacrificing to stones and (divination by) arrows, are an abomination; of satan’s handiwork: Eschew such (abomination) that ye may prosper (Qur’an; 5:90). This is what has made the Takaful transaction to be free from gambling (Ali, 2000).

On the other side, the validity of Takaful practice is sourced and originated from the Arab tribal custom (urf) and the practice of Al-Aqila which has been approved by the Holy Prophet (SAW) in the Hadith. 

“Narrated by Abu Hurairah (R.A), he said that once two women from Huzail tribe had clashed. One of them hit the other one with a stone which had killed her (the pregnant) and the unborn baby. The heirs of the victim brought an action to the court of the Holy Prophet (SAW) who gave a verdict that the compensation for the Foetus shall be a male or female slave; while the compensation for the killed woman is a blood money (dyat) to be paid by the Aqila the relatives of the Father’s side of the killer (Sahih Al – Bukhari, vol. 9. No 45:34). 

Takaful transaction is permissible in Islam as it can be considered under the hadith saying, that “… people are bound by their condition except the  condition which prohibits the lawful one or the one which permits the unlawful one… (Al-Tirmizi).

Therefore, the scope of an Islamic insurance is very wide and flexible which is designed for the purpose to ensure a smooth life in the society and this is in line with the Qur’anic injunction “… our lord, give us happiness in this world and happiness in the hereafter… (Qur’an: 2:201). 

Takaful success is dependent upon the sincerity and pure intention in order to achieve the desired result from Allah (SWT) that says “…And they have been command no more than this, to worship Allah (SWT), offering him sincere devotion. (Quran, 98:5). The tradition of the Holy Prophet (SAW) also shows validity of action is depending on intention and therefore every man shall have but that which he intended… (Al – Bukhari and Muslim). In the similar direction, the Holy Prophet (SAW) is saying that “verily Allah (SWT) never looks at your physical shape or at your appearance but considers sincerity in your hearts… (Sahih Muslim in Riyadussalihin).
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An attempt is made to review the existing literature in the field of the study which enables us to explore the origin of the Islamic insurance, theoretical and conceptual framework that have enable the development of Takaful so as to allow us to have a comprehensive understanding of the subject matter. 
Origin of the Islamic Insurance (Takaful)

The chapter has equally discussed the Shari’ah justification on the concept of Islamic insurance (Takaful), various misconception about insurance especially among Muslims and analysis on the empirical evidences drawn from the studies conducted in the Malaysian Takaful industry.

Origin of the Islamic Insurance (Takaful)

The known historical facts on the human development indicate that there exists a social insurance which has been very common among different communities, tribes, region or countries of this world. It has been postulated that every society has its own unique risk management strategy which does evolve over a period of time. 

That is why; Isa & Dandago (2010) are reported to have said that the concept of protecting people or wealth against loss by natural perils is traceable back, according to some historians, to at least 215 BC. This was more precisely, the time when the Roman governments were required by its suppliers of military stores to accept all risk of loss arising from the attacks of enemies or from the storms which resulted in the suppliers to be insured by the government. 

In the same vein, some have acknowledged that the act of Pharaoh of Egypt who accepts advices from Prophet Yusuf (See Qur’an 12:55 where the Pharaoh requested the Prophet to interpret his dream) has been tantamount to the modern day Takaful. For almost ten centuries before the advent of conventional insurance companies, the Muslim societies in Arabia had adopted the concept of  risk mitigation to assist victims of natural disasters or hazards of trade on a journey, (Jafer, Ismail, Noor & Unwin, 2010). 

In the same argument, Billah (Undated (d)) said that the practice of insurance had been in existence in Arab’s culture since before the time of Holy Prophet (SAW) of Islam. The Prophet only approved the transaction which was later developed further by his successors.

Al-Aqilah, a doctrine which was founded in the ancient Arab tribes as a tribal custom became the  genesis  of  the  modern  day’s  Islamic  insurance.  The  doctrine,  as  justified  by many encyclopedias, refers to as a mandate that if any member of a tribe kills another member of a different tribe, the heirs of the victim will be paid with an amount of blood money as compensation by the close relatives of the killer. 

The relatives of the killer are addressed as Aqila. As noted, the word is an Arabic terminology which means Asaba that denotes paternal relatives of the killer (Billah, undated (d); Swartz & Coetzer, 2010; Isa & Dandago, 2010; and Maiturare, 2009).

Al-Aqilah practice at the time of the Holy Prophet (SAW) marked the second phase of Islamic insurance development. The concept enjoyed the Holy Prophet’s (SAW) affirmation which had resulted in the emergence of the verdict from the Sunnah (tradition of the Holy Prophet (SAW)). 

The Sunnah had stated as narrated by Abu Hurairah (R.A) that once there were two women from Huzail tribe who clashed with each other that had led to a death of a pregnant one. Holy Prophet’s (SAW) verdict was sought who said “the compensation of the foetus is this and for a woman is that” as it was fully explained in Sahih Al-Bakhari, Vol. 9, and No 45:34. It was this verdict that had become part of the first constitution of Medina in 622 BC (Farooq – Chaundry, Alam & Ahmad, 2010 and Billah, undated (d)). 

In 14th  to 17th  century, there existed the Sufi order of Kazeeruniyya that had become very active especially in the port cities of Malabar and in China. This Sufi order served as a kind of Marine travel insurance company. It had been associated with the tomb of Abu Ishaq Ibahim Ibn Shahariyalib (963 – 1035:C.E) whose blessings (as people believed) were considered as protection against peril during the sea voyage which meant his blessing had acted as insurance for merchant who travel through sea. 

By the 19th  century, some Muslim merchant had begun to doubt the validity of this insurance, especially with regard to Islamic injunction. Therefore, they sought for a fatwa (Islamic opinion) of the Hanafi lawyer, Sayed Ibn Abidin (1784-1836) about the validity of Marine insurance under Islamic law. 

According to him; “I see that it is not permitted to any merchant to get indemnity for his damaged property against the payment of a certain sum of money known as insurance premium. This is a commitment for what should never be committed to (Farooq, 2010 et al; Al-Ghadyan, 1999; Billah, undated (a); and Khan, 2011).

For many years, the practice of mutual assistance was not made to enjoy commercial connotation as neither profit nor gain or loss was incurred at the expense of others. Rather, it evolved as a useful social insurance practice to mitigate the burden of an individual by dividing it among fellow members. 

This resembles the practice of social insurance that is common among Nigerians where in Hausa community, it is called with different names such as Adashi, Zubin Biki, Ajo etc which are collectable by each member periodically or as contribution to assist members in need or to assist members in naming ceremonies, marriage or a member who has suffered a loss (Aliero, 2006; Yusuf, 2009: 36; and Isa & Dandago, 2010). 

By 20th century, the two Fatwas of a well-known Islamic jurist, Muhammad Abdul, on the insurance transaction made the practice to enjoy some commercial bearing. He says: the insurance is like a transaction of al-Mudharabah financing technique while life insurance resembles an endowment, which according to him, are legal in Islam (Billah, undated (a)). 

A Halal-Haram argument (that is lawful or unlawful) continues among scholars concerning the position of conventional insurance in Islam. By 1976, when the first International Islamic conference on Islamic economics was held in Mecca, Saudi Arabia, the outcome of the meetings was as follows; that all kinds of conventional commercial insurance were declared invalid in Shariah (Hamid & Othman, 2009).

In the modern day context, the practice of Islamic insurance (Takaful) company was founded in Sudan by the Faisal Islamic Bank in January, 1979 and in the same year, Islamic Arab insurance company was established in Saudi Arabia and later in 1980 the same company opened another division in United Arab Emirate (U.A.E). From then, the growth of Takaful has begun to manifest across the world. It is asserted that currently there are more than 130

Takaful companies in operation worldwide. Nearly half are found in Gulf Cooperation Countries (G.C.C) of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE. Countries with majority Muslim populations such as Nigeria, Pakistan, Egypt and Bangladesh, the Takaful market take off are at embryonic stage and are almost totally untapped market in which insurance penetration hover somewhere below 2% of their GDP. Globally, it is estimated that the industry is growing at 20% to 25% per annum far outstripping the 2.5% to 5% annual growth for conventional insurance premium. Scholars argue that the Takaful market is now, currently concentrated in Malaysia (since its inception in 1984 to date) and Middle East. 

They said that the Takaful industry gained momentum in early 2000 when the Malaysian government promoted it and the significant growth was witnessed thereafter (Swartz and Coetzer, 2010; Jaffer,et al 2010; Ahmad, Masood & Khan, 2010; Khan, undated and, Isa & Dandago, 2010). 

However, the concept of Takaful came to be known in Nigeria, somewhere around 2003. This was when African Alliance Insurance Plc introduced its family Takaful products. Then, Cornerstone insurance Plc followed suit by setting up a division called Halal Nigeria Limited which offers general Takaful products into Nigerian insurance market. Niger insurance Plc has later joined the trend.
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The following relevant terms are defined for clarity.

Definition of the Islamic Insurance (Takaful) Term

i. Assurance: It is a conventional insurance policy which shares risk that come with mutual solidarity and guarantee as opposed to the transfer of risk.

ii. Average Clause: It  stipulates  that  a  Takaful  fund  is  only  liable  for  such proportion of the loss as the sum covered bears to total value at risk.

iii. Capacity: It refers to the Takaful operators’ existing assets and structures that can enable them to market the services.

iv. Competences: It refers to the skill and knowledge of Takaful which is required to enable the operators to convince customers to buy the Takaful services.

v. Claims: It is a notification to a Takaful operator that payment of an amount is due under the term of the certificate.

vi. Claims Ratio: It is the ratio of Net Claims incurred to earned contribution.

vii. Contribution: It is the payment of an amount (premium) by a participant to the Takaful protection pool, whether direct or through intermediaries for the purpose of mutual protection and assistance.

viii. Designated Charities: In the event that there is a surplus in the Takaful protection pool after all expenses have been deducted, then that Net surplus will be donated to a designated charity or charities.

ix. Al – Dharurat: This concept is used to provide permission for an action that would be considered Haram under normal circumstances, borne out of the necessity of the situation.

x. Event of Loss: This is an event that gives rise to a loss as defined in the Takaful policy.

xi. Fatwa: Juristic opinion, juridical decision in line with the Muslim faith. 

xii. General Takaful: This is a protection to participant against losses arising out of perils such as accident, fire, flood, liability and burglary.

xiii. Gharar:  This means uncertainty, it is a transaction under Islamic law which is held invalid, preventable and avoidable due to the involvement of the element of uncertainty.

xiv. Group Family Takaful: Islamic insurance on a group of people under a master certificate typically issued to an employer for the benefit of employees or to members of an association.

xv. Hadith: This is a word of the Holy Prophet (SAW), his traditions, the narrative of the sayings and actions or the acts of his companions which have gotten his blessing or approval.

xvi. Hibah: It means a gift

xvii. Halal: Lawful, valid in Islam; one of the five major Shariah categorizations of human acts.

xviii. Haram: Unlawful, forbidden in Islam; one of the five major Shariah categorization of human acts.

xix. Indemnity: It refers to as a restoration to the claimant of a loss by payment, repair or replacement.

xx. Islamic Finance: Financial services that meet the requirement of the Shari’ah or Islamic law.

xxi. Kafalah: This is an agreement to pay the debt of another party who defaults, or to guarantee.

xxii. Maisir: This means Gambling; is one of the fundamental prohibitions in Islamic law and finance. 

xxiii. Mudaraba: It is an investment co-partnership whereby the investor (the Rab’ul Mal)  provides  capital  to  another  party/entrepreneur  (the  Mudarib)  in  order  to undertake a business/investment activity for profit and loss sharing purpose.

xxiv. Qard Hassan: It is an interest-free loan, identified as a means of charity or helping other in need.

xxv. Participant: The insured (muwakkil) is the contributing party to the Takaful policy who is covered through the mutual protection and solidarity of the Takaful policy.

xxvi. Participants Account: This is where the portion of contributions from the participant for the purpose of investment/saving is credited.

xxvii. Participants’ Special Account: This is where the portion of contribution from the participant for the purpose of charity (Tabarru) is credited.

xxviii. Rabbul Mal: This means capital provider/ Takaful operators or companies. xxix.     Rasul mal: This means Takaful contributor/customers who buy the service.

xxx. Riba:  This means usury or interest; is a return of money on money whether is fixed, floating, simple or compounded.

xxxi. Shariah: Islamic common law derived mainly from the noble Qur’an and the Hadith.

xxxii. Sunnah: The saying, the action, the teaching and the approval of the Holy Prophet Muhammad (SAW).

xxxiii. Ta’awun: This means cooperation, that is, cooperation among people.

xxxiv. Tabarru: This means donation, charity, the purpose of which is not commercial. xxxv.     Takaful: This means mutual responsibility, another name for Islamic insurance.

xxxvi. Wakala: This means Agency i.e. a contract between an agent and principal that enables the agent to render services and be paid a fee.

xxxvii. Waqf: This means a charitable donation.
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A study of this nature is necessary to have a framework which can enable one to have proper grasp and understanding of the concept. Islamic jurists’ resolution on the system of insurance that serves as an alternative to the conventional commercial insurance is found on the concept of al-Takaful. The term is an Arabic word, an infinitive noun which is derived from the root word, Kafl or Kafala, which denotes guarantee or responsibility. 

Conceptual Framework of the Islamic Insurance (Takaful)

Takaful is an Islamic insurance transaction on a policy of mutual cooperation, solidarity and brotherhood against unpredicted risk or catastrophe, in which the parties involved are expected to contribute genuinely. An Islamic Insurance (Takaful) main chief characteristic is Al-Musharakah which means sharing, of responsibility, guarantee, collective assurance or mutual undertaking (Maiturare, 2009; Billah, undated(c) (e), Farooq, et al 2010 and Khan, undated).

Technically, Takaful is viewed, economically, as a mutual guarantee or assurance based on the principle of Al-Aqd (formal contract) provided by a group of people living in the same society against a defined risk or disaster befalling one’s life, property or any form of valuable thing.  Hence,  it  is  described  as  cooperative  insurance  with  mutual  agreement  (Billah, undated: 2(e)). In the same vein, Malaysian Takaful Act (1984) defines Islamic insurance as a business of Takaful whose aim and operation do not involve any element which is not approved by the Shariah. 

The concept is acceptable in  Islam  for the following reasons: the policy holders would cooperate among themselves for common good; every policy holder would pay his subscription in order to assist those of them who need assistance; it falls under the donation contract which is intended to divide losses and spread liability according to the community pooling system; the element of uncertainty is eliminated insofar as subscription and compensation are made as at when due; and finally, it does not aim at deriving advantage at the cost of other individuals Billah (undated:1 (c)). 

The basic objective of Takaful is to pay for a defined loss from a defined fund. And this is in line with the Takaful features which are: cooperative risk sharing by using charitable donation to eliminate gharar and riba; clear financial segregation between the participant (insured) and the operator (insurance company); and Shariah – compliant underwriting policies and investment strategies (Ahmad, Masood & Khan, 2010 and Alamasi, 2010).

Many scholars agreed on what constitutes the principles of contract of Islamic insurance (Billah, undated (a); SECP, 2010). It is unanimously agreed that there are 3 principles which are: avoidance of riba (usury or interest), avoidance of maisir (gambling) and avoidance of gharar (uncertainty) in the Takaful transaction (Billah, undated (a) and SECP, 2010). 

These principles are the basis upon which the OIC Fiq Academy has used to rule out that conventional insurance is forbidden to the  Muslim Ummah (Alamasi,  2010). But, some scholars have added other principles such as al-jahalah (ignorance) and Haram (Forbidden thing in Shariah) (Alamasi, 2010; SECP, 2010).

Theoretically, the practice of Islamic insurance is built on the basis of contract of profit and loss sharing (Aqd al – Mudharabah) and unilateral contract of donation (Aqd al Tabarru). 

Mudharabah theory states that the funds will be contributed by two or more people for the  purpose of investment at which the profit or loss will be shared among the participants. But, the doctrine of tabarru, Billah (undated: 3 – (c)) said, is synonymous with the idea to the legal consequences of al-sadaqah (charity), al-Hiba (gift) and al-Khairat (donation); wherein anything  once  given  away as  donation  in  favor  of  something  or  someone,  the  donated property cannot generally be retracted. The donor automatically loses title over the donated property soon after it is made as al-Tabarru or al-Sadaqah or al-Khairat or al-Hiba.

Practically, Takaful operation as narrated by Billah (undated (e)) occurs when anybody in society who has the legal capacity may contribute a sum of money to mutual cooperation fund to ensure material security for one against a defined risk probably encountered by another’s life or property. 

Thus, those who contribute to the mutual fund are known as participants while those who among the participants face the risk and are assisted by the fund known as insured. Those who actually benefit from the fund are known as the beneficiaries of the cooperative fund. The monetary contribution made by the participants to the fund is registered to the licensed body or corporation known as a Takaful operator, who bilaterally manages the fund according to Shariah principles and also provides a reasonable financial security for those genuinely deserve it against the loss or damage suffered by them resulting from a defined risk.

 Furthermore, the contribution made by the participants is put into two funds: one of them is investment fund according to the principles of al-Mudharabah (profit and loss sharing) for instance, 95% of the contribution, while the remaining 5% is treated as charity according to the principles of al-Tabarru. Both funds are termed in Malaysian Takaful industry   as   Participant’s   Account   (P.A)   and   Participant’s   Special   Account   (PSA) respectively. 

According to  Jching (undated), Takaful  business  is  divided  into  two  categories:  Family Takaful and General Takaful. Family Takaful plan is a Shariah compliant counterpart of conventional life insurance which refers to as a combination of a mutual financial indemnity scheme and an investment scheme. In the plan, the participant’s contribution is apportioned into a donation account representing a financial indemnity (tabarru) with the balance into another  account  for  the  purpose  of  the  participant’s  saving  and  long-term  investment. 

Example  of  Takaful  plan  include:  individual  family  Takaful  plan,  mortgage  Takaful, education Takaful plan and health Takaful. In contrast, the second type is a general Takaful plan which is solely provided on a short term mutual indemnity basis and is usually one year, without the saving aspect. Should there be a net surplus in the general Takaful fund, it shall be shared between the participants and the operator. 

Example of general Takaful scheme are: fire Takaful plan, motor Takaful, Marine, aviation and transport Takaful, engineering Takaful and accident Takaful plan (Maiturare (2009), Billah (undated (e)) and Ado (2010)).

Therefore, to ensure its flexibility and suitability to the different socio-cultural and economic background of Muslim population, three (3) different operating models are developed to serve as a basis for building structure of a Takaful scheme. These models are made up of the Mudharabah model, the wakala model and the waqf model. 

Recent findings in the Takaful industries  have  provided  many  variations  developed  by  practitioners  to  address  the limitations of these three models. The variant Takaful models are: Wakala- Mudharabah model, Wakala with incentive fee model, Wakala Mudharabah model (hybrid) and Wakala with Waqf model (Jaffer, 2010 et al). Billah (undated (b)) also argued that Tijari model (Business/commercial) is operational in Malaysia. This model is divided into family Takaful and general Takaful (Onogun, 2011). 

In all these models, however, the operators are free to choose the model depending on many factors such as the target population, regional acceptance, Shari’ah board views, regulatory framework, product design, marketing and pricing technique. 

The most common models are Mudharabah and Wakala model or a hybrid of both. The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) endorsed the hybrid version of the Wakala model (Jaffer et al 2010).
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This study attempts to examine the Islamic insurance (Takaful) services consumption in Kano Metropolis, Nigeria. This is to explore the determinants of Takaful services consumption in the market. Although, some studies had examined economic factors predicting the products consumption, the focus, here, will be the evaluation of non-economic factors.

Scope and Limitations of the Study Islamic Insurance (Takaful)

The researcher’s scope is the area of metropolis/cities, Kano, Kano state, Nigeria. It is a big metropolitan city where most of the ethnic groups in Nigeria are largely represented. Equally, the existing Takaful operators (as observed) concentrate their marketing activities in the metropolis. This might have been due to most of potential and actual customers who are seriously exposed to all dangers and life uncertainty and usually reside in the metropolis.

Due to the embryonic position of the industry, which makes the relevant statistically documented records to be unavailable; the population of this study is infinite and has made application of probability sample to be impossible. 

Although, the researcher cannot get the precise total number of actual and potential customers; he is able to obtain the total number of members of staff of Takaful operators in Kano Metropolis, Nigeria. Therefore, the operators’ staff and agents are included in the study.

However, the study has included the insurance companies that are marketing the Takaful services in the state to be among the population. They are African Alliance insurance Plc (introduces the Family Takaful products in 2003), Niger Insurance Plc (introduces the service in 2008/2009) and Corner Stone Insurance Plc (introduces the General Takaful services in

An attempt was made to collect secondary data from the Takaful operators, but it failed due to the issues of confidentiality and fear of misuse of information. There are some challenges when gathering primary data especially due to the novelty value of the concept of Takaful in the state. 

That is why the questionnaire for the study is administered with the assistance of research assistant that is believed to; might have had good relationship with targeted subjects. The  researcher  also  makes  additional  effort  to  make  sure  that  the  respondents  have understood the purpose of the study and have really perceived the questions in line with the researcher’s intent.

The big limitation of the study is inability of researcher to retrieve as many as possible the copies of questionnaire administered to those sampled, especially females. Similarly, the nature of the study’s population makes it impossible to employ powerful statistical tools of analysis that can make generalization of the findings very scientific. The sampling Technique used in the study is purposive judgmental. It is a non-probability sampling method that has suffered problem of being capable to be free from bias.

This has also affected the quality of the findings to be capable of being generalized. But, the researcher has used many non- parametric statistical tools to minimize the effect. In conclusion, however, the researcher has found it difficult to get a required attention from one of the Takaful operator. The operator- company’s attitude toward the researcher shows as if it is hiding something and does not want the public to know much about its Takaful business.
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The literatures available on the Takaful insurance are mostly written in either Malaysia or Arab countries. These countries share some socio-religious values but different socio-cultural and economic background with Nigeria. Thus, the research findings on these countries would  have to be applied in Nigeria with caution and necessary modification which also served as a gap that would be filled.
Significance of the Study Islamic Insurance (Takaful)

In  his  conceptual  study,  Yusuf  (2006)  had  noted  that  the  introduction  of  interest-free insurance encourages Muslim-community to get attracted on the products and gains support and patronage of Muslim population. This is in contrast to the findings of Yusuf, Gbadamosi & Hamadu (2009) which state that there is negative attitude among Nigerians on the conventional insurance services. This contention brings the need to study Takaful position in order to address the gap.

The empirical studies on Takaful and its products demand or consumption are mostly done in a foreign country like Malaysia (Redzuan, Rahman, & Aidid, 2009; Hamid & Othman, 2009; Salleh & Kainaruddin, 2011; Hamid, Osman & Nordin, 2009 and Farooq, Chandhry, Alam & Ahmad 2010). The findings of these studies might not explain the different environment like Nigeria, hence, brought the need for Nigerian research that can suit its peculiarities to fill the gap.

Besides, many studies on Takaful insurance are conceptual in nature (Billah (a) (b) (c) (d) (e) (f) (g) undated; Siddiqui & Athmey, undated; Swartz & Coetzer, 2010 and Alamasi; 2010). This shows that there is need for scientific research that can explain the true position of Takaful products consumption. Because, the emergence of Takaful in Nigerian insurance industry has been in existence since 2003 and yet no much concerted  efforts are made academically to study the subject matter. 

This study, however, is designed to enable the Takaful operators to understand the relevant factors to be considered when marketing the services and even in determining the level of the consumptions of their services. 

The research would equally add more value to the existing academic literature on the Islamic finance on the Islamic insurance. In conclusion, therefore, the findings of this research will contribute to the development of the nation’s economic sector especially with the emergence of the first fully Islamic bank in Nigeria (Ja’iz Bank) and the interest shown by more conventional banks to open Islamic banks windows in 2011.
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In spite of the significance of commercial insurance, in human life, there exists a low level of insurance culture among Nigerians (Yusuf, Gbadamosi & Hamadu, 2009). Historically, religion has provided a strong source of cultural opposition to life insurance. Because; many religious people believe that reliance on life insurance is resulted from distrust of God’s protective care. 

This might have been among the reasons (because, many Nigerians have respect very much for their religion and it has become part of their culture) that modern insurance is not popular in African countries (Yusuf et al, 2009). 

In addition; the opposition to conventional commercial insurance enjoys much more widespread support in the Muslim countries. Conventional insurance as argued by Swartz & Coetze (2010) is an agreement whereby an insurer undertakes (in return for the agreed premium) to pay a policyholder an amount of money (or its equivalent) on the occurrence of a specified event. 

The specified event must have some elements of uncertainty about it. The uncertainty may either lie in the fact that although the event is bound to happen in the ordinary course of nature; the timing of its occurrence is uncertain; or the fact that the occurrence of the event depends upon accidental causes, and/or the event, therefore, may never happen at all. These features are what have disqualified the service to comply with the shariah injunction.

Scholars have discussed the prospect of Takaful (Bilal, undated; Alamasi, 2010; Rahman, Yusif & Bakar, 2008 and Redzuan, Rahman & Aidid, 2009). Yusuf (2006) sees an interest- free insurance scheme in the developing nations to have gained the support and patronage of the Muslim population. Also Osoko (1992) cited in Yusuf, Gbadomosi &Hamodu (2009) argues  that  there  exists  for  long  time  before  the  advent  of  commercial  insurance,  an institution of social insurance. 

Social insurance institution evolves through the existence of extended family system and social associations such as age groups, naming ceremonies, marriages etc. It operates by means of providing cash donations etc, to help members of extended family or communal associations who suffer a mishap. This social insurance which is very common among Nigerians has resembled Takaful insurance.

However, the long existence of social insurance institution has been determined to have no significant effect on building a strong insurance culture among Nigerians (Yusuf, Gbadamosi
&  Hamadu,  2009).  Until  now,  there  is  no,  to  the  knowledge  of  the  researcher,  study 
conducted to assess the institution of Islamic insurance (Takaful) to determine its position with  regard  to  the  public  attitude/Islamic  insurance  culture  and  service  patronage  by Nigerians. Therefore, this study is aimed to explore non-factors determining Takaful services consumption in Kano Metropolis, Nigeria.

The emergence of Islamic insurance which has considerable features that suit the religious culture of the majority of people in Kano Metropolis; it would expectedly gain high support and patronage from the populace. But, the preliminary survey by the researcher has shown otherwise. Conceptual study by Yusuf (2006) predicts high support and patronage of Islamic insurance  products  among  Muslim  population.  

The  empirical  findings  of  Redzuan  et  al (2009), also, state that income level of a household is a strong predictor of family Takaful consumption in Malaysia. In Kano Metropolis, however; despite being a commercial center; many people whose income level can be said to be substantive; are not keen on Takaful service patronage.

The major problems which might have marred the performance of Takaful operators in Kano Metropolis are their inability to identify the right and relevant factors to be considered when marketing the services in the state.   

The relevant marketing and consumer variables theoretically presented by the study are: building strong public awareness of the Takaful services; public attitude towards the Takaful services; public perception on the Takaful services; public trust and confidence on the Takaful operators; and capacity and competences of Takaful operator to sell the products in the market. 

These go in line with the assertion which has stated that Islamic Insurance products (Takaful) are unsuitable to be sold under the branch, division or window of conventional insurance companies. Because, it is observed that the  conventional  insurance  has  already  enjoyed  negative  connotation,  especially  among 

Muslim community.   Therefore, the existing operators might not have had the necessary capacity and competences to build the trust that the products are Islamic and are different from the conventional insurance which is declared unlawful by the religion of Islam. These factors; however; are already conceptually identified by many studies (Ali; undated; Billah, undated; Zelizer 1979 cited in Yusuf, Gbadamosi & Hamadu, 2009 and Akhter, Akhtar & Jafri; undated). This study, therefore, aims to determine these factors empirically.
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In the context of Islamic financial system and economy, there is emergence of insurance practice called by name; Takaful. Takaful is an alternative to conventional insurance. It is an Islamic  insurance  product  which  acts  as  a  social  scheme  based  on  the  principle  of brotherhood, solidarity and mutual assistance among society. It provides mutual financial assistance to those who are members of Takaful scheme; that voluntarily agree to contribute a certain amount of money for that purpose (Ali, 2011). 

Background to The Study The Islamic Insurance (Takaful)

The scheme operates as a legally binding agreement among all the participants who pay or indemnify any of their members that suffers a loss as specified in the policy document. Therefore; should any member suffers a catastrophe; he would receive a certain sum of money or financial benefit from the fund as defined in the pact so as to help him meet the loss for a defined loss from a defined fund (Stagg-Mecey; 2007 in Swarz & Coetzer, 2010; and Billah; undated (a)).

On the other hand, modern conventional commercial insurance, in these days, has emerged to mitigate the seriousness of both personal and business risks which are inherently in- built in every human endeavor.  Its products are specifically designed to provide a protection to individuals or businesses against contingencies; created out of human quest for security and stability (Redzuan, Rahman & Aidid; 2009). 

It acts as a risk transfer mechanism which is aimed at providing peace of mind and the protection against losses. It is either to handle risk assumption or risk transfer or loss prevention activities. The scheme utilizes method that combines people or institutions by persuading a large number of individuals or companies to pool their own risk into a large group to minimize overall risk (Ali, 2005). 

Risk, in insurance business, represents a probability of particular event to occur or not. It is a chance of happening of something that will have an impact upon peoples’ objectives. It is measured in terms of likelihood and consequences (Gowa, 2002). Traditionally, the concept of risk has been associated with uncertainty of events in the future. 

The higher the uncertainty of an event, the higher is the risk. It is argued that risk is the amount of loss associated with property or life. Risk to a property can be damages to a car, building or house. Risk; to a life, however, is simply described as a poor health, pre-mature death, or injuries as a result of an accident etc. Thus, risk is defined as a culture, processes and structures directed toward effective management of potential opportunities and adverse effect (Akhter, Akhtar & Jafri; undated).

It has for long been established that in every society, there exist risk management strategies. They are culturally embedded to suit the people’s peculiarities and risk exposure. This has made many scholars to view the term differently. As argued by Okofor & Tela (2006), to manage risk, means to identify vulnerabilities and threats to assets or life in achieving one’s objectives and deciding what counter measures if any, to take in reducing the pure risk to an acceptable level.  

In their submission; Falegan  (1991) and Harrington  & Niehaus (1999) maintain  that  pure  risk  is  only managed  through  either  risk  control  mechanism  or  risk financing; and among the risk financing schemes include: risk retention, hedging contract and insurance. This study has adopted an insurance practice and wants to examine it in the context of Islamic financial system.

Islamic insurance (Takaful) service has been at embryonic stage in Nigerian insurance industry. Its introduction has not lasted for more than 10years. In fact, it is in the year 2003 that the African Alliance Insurance Plc has entered Kano market. 

No Insurance company has followed the suit till 2009; when Corner Stone Insurance plc; through its division; Halal Takaful Nigeria Limited which enters the market and offers general Takaful products. Niger insurance Plc also has been in the market (2008/2009) competing directly with these companies. Thus, Niger insurance Plc, instead of African Alliance insurance Plc which offers Family Takaful services as Window operation and Corner Stone Insurance Plc that offers General Takaful services by creating a Division to handle the products, sales its Takaful (Mutual Halal Plan Policy) as a mere extension of the conventional insurance products mix. 

The companies  have offered  two  distinct  and  different  types  of Takaful  services  which signify absence of direct competition. Although, emergence of Niger Insurance Plc in the market creates competition in offering Family Takaful services, it is not very pronounced, as observed.  

Yet, with this partial monopoly status enjoyed by the companies and more than 7 years stay in the market, the services patronage have not gained presupposed wider use and acceptability among consumers in the market. It is against this background that this study is designed to explore the determinants or factors that can guarantee effective consumption of the services so that wider acceptability and patronage would be obtained.
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Islamic insurance is a substitute of conventional insurance. It is an option for people whose religious belief  has  discouraged  them to  patronize  risk  management  products  that  are  characterized  with elements of uncertainty, interest rate and other non-religious complied principles. The study, however, aims at exploring the factors influencing Islamic Insurance (Takaful) services consumption in Kano Metropolis, Nigeria.

Abstract Example The Islamic Insurance [Takaful]

This is to examine a given research problem by answering these questions which are: To what extent does building public awareness of Takaful services have significant effect on Takaful services consumption? To what extent does the level of public attitude have significant effect on the Takaful services consumption? To what extent does the level of public perception have significant effect on the Takaful services consumption? 

To what extent does the level of public trust and   confidence   reposed   on   Takaful   operators   have   significant   effect   on   Takaful   services consumption? And finally, how does the level of  Takaful operators’ capacity and competences have significant effect on Takaful services consumption? The five (5) Hypotheses formulated and the research objectives are in line with the research problem’ questions raised. The study’s design is survey research in which the exploratory method is employed using questionnaire and unstructured observation as the means for collecting primary data of the study. 

The research’s sample size is 411 where 384 represent actual and potential customers and 27 are the staff/agents of Takaful operators in Kano Metropolis. The study has analyzed the data using chi-square statistical tool. The findings of the study  indicate  that  all  the  five  (5)  Null  Hypothesis  formulated  are  rejected.  

The  results  have discovered that the independent variables:  public awareness of Takaful services, public attitude, public perception, public trust and confidence upon Takaful operators, capacity and competences of Takaful operators; have significant effect on the dependent variable (Takaful services consumption) in Kano Metropolis. 

It is therefore recommended: that all the stakeholders in Islamic insurance (Takaful) businesses shall put hands together and harness the available resources to promote the business; that the stakeholders shall embark on the attitudinal change campaign aims at making public to understand the need for purchasing Takaful services as a means of employing risk management and that the existing operators shall have to do a lot in creating a unique identity which can make the Takaful so different from conventional insurance so as to establish favorable perception of the subject matter; that there shall be needs for creating business trust and confidence between the public and the operators; and the stakeholders in the industry shall provide the needed capital investments which can enable the Takaful business to be well established and be capable in winning more customers.

This would make the Takaful operators capacity to be very strong and strong capital base can enhance the competences of the players and their competitiveness in the industry.
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ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank – one of India’s foremost financial services companies- and Prudential plc – a leading international financial services group headquartered in the United Kingdom. Total capital infusion stands at Rs. 47.80 billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%. It began its operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA).

Profile of ICICI Prudential Life Insurances Company Limited

ICICI Prudential has been voted as India’s Most Trusted Private Life Insurer for three consecutive years by the Economic Times. ICICI Prudential has retained its position as the number one private life insurer in the country, with a wide range of flexible products that meet the needs of the Indian customer at every step in life.

As regards the distribution of ICICI Prudential Life, It has one of the largest distribution networks amongst private life insurers in India. It has a strong presence across India with 2,100 branches (including 1,116 microoffices) and an advisor base of over 290,000 as on December 31, 2010. The company has 18 bank assurance partners having tie-ups with ICICI Bank, Jalgaon People Co-op Bank, Ratanagiri District Central Co-op Bank, Ballia Kshetriya Co-operative Bank, Renuka Nagrik Sahakari Bank, Bhandara Urban Co-operative Bank etc.

Objectives of the Unit
To be the dominant Life, Health and Pensions player built on trust by world-class people and service ICICI Prudential Life Insurance company aims to achieve by; 
(i) Understanding the needs of customers and offering them superior products and service; 

(ii) Leveraging technology to service customers quickly, efficiently and conveniently; 

(iii) Developing and implementing superior risk management and investment strategies to offer sustainable and stable returns to our policyholders; 

(iv) Providing and enabling environment to foster growth and learning for its employees with transparency.

The success of the company depends upon values – Integrity, customer First, Boundary less, ownership and passion. Each of the values describes what the company stands for the qualities of its people and the way company work.

The company believes in redefining and reshaping the sector. Given the quality of its parentage and the commitment of its team, there are no limits to its growth.

Organizational Setup & Pattern of Management
As regards Management pattern of the ICICI Prudential Life Insurance Company Limited, the Board Comprises of reputed people from the finance, industry both from India and abroad. The Board consists of one Chairperson and nine Directors as on 31 March 20101. The Board carried on its activities with the help of different six committees through 1918 officers in 1726 various locations as on March 31, 2010. The Board of Directors is responsible for overall corporate strategy and other board related matters. 

The Managing Director oversees implementation of strategy, achievement of the business plan and day to day activities and operations related issues.