Concept of Takaful

Takaful is an insurance concept which is based on Islamic Muamalat and fully adhere to all rules and regulations pertaining the Shariah Laws. It is a mutual arrangement between parties in which they agree to provide material assistance to one another or a group, in time of a misfortunate. This concept, in fact, has been practiced for over 1400 years ago. In principle, Takaful is based on mutual cooperation, responsibility, assurance, protection and assistance between groups of participants who subscribe to the schemes. In an nutshell, it is the provision of shared contributions to help those who are in need. In a nutshell, Takaful is a concept based on solidarity and brotherhood.

These fundamentals are based on the sayings of Prophet Muhammad s.a.w. (hadith). Some of the examples are:

Basis of Cooperation
"Allah will always help his servant for as long as he helps others."
(Narrated by Imam Ahmad and Imam Abu Daud)

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)

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)

Based on the above hadith, Islamic scholars had decided that there should be a concerted effort to implement the Takaful concept as the best way to resolve these needs.