In this chapter , an introduction is given by introduce the past of Takaful, background of study, problem statement, research question, objective of study, scope of study and limitation of study.
HISTORY OF TAKAFUL
Takaful is an Islamic insurance idea which is grounded in Islamic Muamalat (banking transactions), observing the rules and regulations of Islamic law. This concept has been practiced in various forms for over 1400 years. Muslim jurists acknowledge that the basis of shared responsibility in the system of Aqilah as educated between Muslims of Mecca and Medina laid the basis of mutual insurance.
Takaful practices were identified before time of the Holy Prophet Muhammad. It was an ordinary practice among the ancient Arab tribes when a member of tribe was killed by another tribe, the heir of the victim would be paid an amount of blood money as recompense by the close relatives of the killer.
The fundamental idea of Aqilah was that the ancient Arab tribe had to be ready to make financial contribution on the behalf of the killer to compensate the victim heir.
The doctrine of Al -Aqilah as a tribal custom
Such readiness to make financial contribution is similar to the premium paid in insurance practice. While the compensation paid under Aqilah could be similar to the indemnity in today insurance practice.
Practice of Holy Prophet PBUH
Prophet himself accepted the concept of Aqilah in the following verdict given a dispute between two tribe of Huzail.
Narrated by Abu Hurairah r.a. who said that
"Once two women from the tribe Huzail clashed when one of them hit the other with the other with a stone, which killed her and also the fetus in the victim womb. The heir of the victim brought an action to the court of the Holy Prophet who gave a verdict that the compensation for the infanticide is freeing of a male or female slave while the compensation for killing the women is the blood money ( diyat) which to be paid by the Aqilah of the accused."
Practice of the Companion
A further development in the practice of the companion can be seen during the period of the second Caliph Sayyidina Umar r.a. The government encouraged people to practice Aqilah national. Sayyidina Umar r.a. commanded that a Diwan of Mujahidin be recognized in various district. Those whose names were recorded and restricted in the Diwan had to contribute blood money for any act of manslaughter committed by someone from their own tribe.
Development during the 14th -17th centuries
During this period, a Sufi Order, the Kazerunniya was active especially in the port cities in Malabar (off the coast of India and China). This order served as a kind of marine travel insurance company. It was associated with the tomb of Abu Ishaq Ibrahim Ibn Shahriyah (963-1035 CE) whose blessing (barakah) was measured as protection against the perils of sea voyages.
It was ceased due to decline of the spirit barakah of Abu Ishaq. Such turn down also attributed to the fact that there were several insurance companies from Europe which had reached the shores of the Indian Ocean and offered more attractive alternative protection against such risk.The history and uniqueness of Takaful in the past to increase the Takaful system in the present.
BACKGROUND OF STUDY
Takaful, the Islamic alternative to insurance is based on the concept of social harmony, collaboration and mutual indemnification of losses of members. It is an agreement among a group of persons who agree to jointly indemnify the loss or injure that may impose upon any of them, out of the fund they donate collectively. The Takaful contract so approved usually involves the concepts of Mudarabah. Tabarru to donate for advantage of others and mutual sharing of losses with the on the whole objective of eliminating the element of uncertainty.
Basic concepts
Certain concepts are specific to the Takaful business.
1) Al- Mudharabah
Accurately means profit sharing. The Takaful operator accepts and invests the Takaful contribution (premiums) received from the Takaful participants. The contract will specify how the profit will be shared between the participants and the Takaful operator. For example ratio may be, on 60: 40 bases
2) Al -Takaful
This means joint guarantee whereby the participants jointly guarantee among themselves. Any associate faced with a disaster will be financially compensated from funds contributed by the participants.
3) Tabarru
These refer to the elements of donation. Each participant agrees to hand over a portion of the Takaful contribution to a common fund that is used to pay members those bear a loss.
In the Takaful operation there are 3 major elements which are prohibited:
1) Gharar (Uncertainty)
The uncertainty for the subject matter such as an accident, price for the declare money and the credit period is also uncertain is prohibited in the Takaful operation. The policyholder is uncertain about the receipt of claim depending upon the occurrence of an unforeseen event like an accident or death, marriage, and education. If event comes earlier the company receives fewer premiums but pays complete claim to its policyholder. For an example the Gharar sale is a deal to sell what ever a pregnant animal will produce before it is actually borne or to put on the market what ever will be caught in a fisherman's net or what ever a pearl diver will bring up in his next dive or to sell the fruits of trees at the beginning of the season when their quality cannot be established yet. All such sales are forbidden in Islam because they involve risk to the buyer.
2) Maisir (Gambling)
Gambling is a financial agreement in which the chance is that any one party would not receive anything that obviously has a great uncertainty. For instance client has paid whole premium and not claimed or the client has paid very less but receives the whole amount. Takaful guiding principle does not involve the element of gambling or betting. The gambler, in a transaction of gambling or betting is always hopping for a material gain in a chance with the spirit of defeating each other rather than cooperating. In contrast the parties in a contract of Takaful are bound together in a manner of mutual cooperation and goodwill in providing material security for the orphans, widows, other dependents as well as one's own self against an unexpected future loss or damage.
Riba (Interest)
The whole amount of premium received by the insurance company is invested in the interest-based business and the money paid to the client is from riba, which is declared unIslamic.
Takaful Model
Non profit model
This refers to social governmental owned enterprise and programs operating of non- profit basis. The contributions paid by the participants are wholly for tabarru (donation) to unfortunate members. The Al-Sheikhan Takaful Company in Sudan, SOCSO in Malaysia are example of this kind of business.
2. Al Mudharabah model
This refers to the cooperative risk sharing where participants and operators share in the distribution profit.An example of this model the Syarikat Takaful Malaysia Berhad (STMB).
3. Al- Wakala model
In this model the cooperative risk sharing occur among participants with a takaful operator whereby a fee is agreed to be paid to the operators whereby a fee is agreed to be paid to the service rendered. The operator shall not participate in the underwriting results. An example of this model is Takaful Ikhlas Malaysia.
The Milestone of Takaful
The Takaful industry in Malaysia today is poised for greater dynamism and growth, within the expanded domestic and international frontier of the Islamic financial system.
The development of the Takaful industry in Malaysia was started in the early 1980's was inspired by the needs of the Muslim in Malaysia for Shariah compliant choice to conservative insurance due to some prohibitions in Islam concerning the conventional insurance. The Malaysian National fatwa committee issued that conventional insurance is prohibited suitable to the existence of the elements of Gharar (uncertainty), Riba (interest), and Maisir (gambling).
A unique Task force was established by the Government in 1982 to study the capability of the setting up of an Islamic insurance company. As a result of the recommendation of the Task force, the Takaful Act 1984 and the earliest Takaful operator was incorporated in Malaysia.
On the 29th November Syarikat Takaful Malaysia Stentorian Bread, the first Takaful operative to be recognized inMalaysia , as well as in the area was integrated on29 November 1984, with an authorized capital of RM100 million and a paid-up capital of RM10 million.
Syarikat Takaful Malaysia Stentorian Bread, the first Takaful operator to be established in Malaysia, as well as in the region was incorporated on 29 November 1984, with an authorized capital of RM100 million and a paid-up capital of RM10 million. It formally commenced business function on 1st August 1985.
On the 30th July1996, the Takaful Malaysia was changed into a public limited company followed with the listing of its shares on the Main Board now identified as Main Market of Bursa Malaysia Securities Berhad. The capital was then raised to RM55 million.
On the1st May 1997 the Central Bank also deal a National Shariah Advisory Council on Islamic Banking and Takaful (NSAC. The council was deemed as the major Shariah authority on Islamic banking and Takaful businesses in Malaysia.
In December 2005 the bank concluded its purchase of 74.24% stake in MNI Holdings Berhad, holding company of Malaysia National Insurance and Takaful Nasional. It has been Malaysia's fundamental bank for well over thirty years, and is expanding its Islamic banking services. The company has annual revenue of about 2.7 billion and employs about 21800 people. The bank completed its purchase of 74.24% stake in MNI Holdings Berhad, holding company of Malaysia National Insurance and Takaful Nasional.
HSBC Amanah Takaful, which began operations in August 2006, plans to leverage its name to boost its market share, while new arrival Kuwait Finance House has formed alliances with Syarikat Takaful Malaysia, Takaful Nasional and Takaful Ikhlas to offer Malaysia's Takaful market to grow rapidly.
HSBC Amanah Takaful, , campaign to influence its name to enhance its market share, while innovative arrival Kuwait Finance House has formed alliances with Syarikat Takaful Malaysia, Takaful Nasional and Takaful Ikhlas to offer Takaful products through its branches. The MIFC is also opening the Takaful sector to global business activity and once again the state hopes to see more firms with Takaful product and services.
MNRB reTakaful Berhad is the first registered re Takaful operator certified under the onshore authority of Malaysia. It was Established in August 2007 with authorized capital of RM500 million US157 million and paid-up capital of RM100 million US$31 MNRB re Takaful Berhad is the first registered re Takaful operator licensed under the onshore jurisdiction of Malaysia.
Established in August 2007 with authorized capital of RM500 million US$157 million and paid-up capital of RM100 million US31 million respectively. It is a wholly owned subsidiary of MNRB Holdings Berhad, the chief Malaysian reinsurance conglomerate which is listed in Bursa Malaysia and having successful operations in conventional universal.BIMB Holdings Berhad announced the first and final dividend of 1.45% per share, which is payable on December 31, 2008.
Following the announcement made on 27 April 2009 on the issuance of two family Takaful licenses under liberalisation of the financial services sector, Bank Negara Malaysia has received several strong applications for the family Takaful licenses.
This reflects the culmination of the wide-ranging strategies that have been implemented over more than two decades for the full potential of Islamic finance to be now realised. However, to ensure that the momentum in the development of Islamic finance is sustained in a now more challenging and fast changing international financial environment, it not only requires continued development of the Islamic financial infrastructures, and the range of products and services it offers, but also an increase in the number of players and an enhancement of their capacity and capabilities in terms of size and quality of their participation in the financial system.
Challenges and opportunities
The Takaful represents an important component in the overall Islamic financial system. Its ability to mobilize long term funds and in providing risk protection and at the same time as an institutional investor is sufficient to say it has risen to become a major player in the global financial system.
The future prospects of Takaful business depend heavily on its ability to convert challenges into opportunities. Challenges that the industry face includes the lack of uniform terms, Shariah understanding human resource development, product innovation Retakaful, promotional and marketing strategies are but are few.
Since ReTakaful is vital in the sustenance of Takaful business, more Takaful business, more ReTakaful operators should be established. At present, the Asian ReTakaful International is catering to the needs of the operators within the Asian region.
Although the Takaful industy in Malaysia has emerged into a robust and dynamic segment of the financial industry since its inception about 18 years ago, the level of market penetration in terms of Takaful policies in force over the total population remains rather low at 3.8 percent compared to that conventional insurance which stands at 34.7 percent (Insurance Annual Report 2003). A large market remains untapped and Takaful operator need to keep pace with their conventional counter parts in coming up with a comprehensive range of products that are innovative and Shariah compliant.
Takaful operators need also to be creative in introducing new marketing strategies in promoting their products. Besides opening more outlets within Malaysia and beyond ASEAN, new distribution channels such as marketing, direct marketing, e- marketing should also be aggressively employed. Looking at the global Muslim market, it is quite clear that insurance penetration is lagging behind, averaging around US 17 per person.( Yusuf, 1996) . It is obvious that if new and innovative marketing strategies are used, then it is possible to reach this market.
Another priority area to be addressed by the operators is the development of human resource. Besides ensuring that the companies are managed by capable and skilled personnel, they must also be equipped with the technical know how in the insurance and Takaful discipline.
PROBLEM STATEMENT
Many Muslims in this country do not understand and know the terms and meaning of the word Arabic in the Takaful, since the language is not the official language of this country. Arabic is written in its own alphabet, with letters, symbols, and orthographic conventions. One of the complexities of the Arabic language is that a single word can have multiple meanings.
There are survey A Study on the Level of Knowledge and Understanding Among Muslims Towards the Concepts, Arabic and Shariah Terms in Islamic Insurance (Takaful) Mohamad Abdul Hamid and Mohd Sukki Othman shows majority of the respondents do not know and understand about tabarru' which is the main and core feature of Takaful that is totally different from conventional insurance. Most of the respondents do not know and understand about the concept that is newly practiced in Takaful for an example al-ujrah (commission) and al-wakalah (agent).Unfortunately, majority of the respondents do not know and understand about the elements of gharar and maysir which create the conventional insurance is against the principles of Shariah. It is found that the most reasons quoted by the respondents are to differentiate the Takaful from conventional insurance and to show that Takaful promotes the Islamic finance products.
The use of Arabic in the Takaful is not much revealed in the media so hard for people to understand the meaning contained in the Takaful concept especially for those who never attend Arabic course.
Every human being especially when they are of different gender has different opinion about things, so the purpose and level of understanding toward the concept of Takaful will be understood according to their perception.
RESEARCH QUESTION
The current study explores and investigates the following research question:
1.3.1 What are the factors that contributed to the level of knowledge, and understanding among Muslims resting on the gender perceptive towards the idea, Arabic and Shariah terms in Takaful?
1.4 OBJECTIVE OF STUDY
To find out the factors that contributed to the level of knowledge, and understanding among Muslims resting on the gender perceptive towards the idea, Arabic and Shariah terms in Takaful
1.5 SIGNIFICANT OF THE STUDY
1.5.1 Significant to the Takaful companies
Some of the findings in this paper may be helpful for the Takaful companies in their challenge to enhance their marketing and promotion activities. Information and knowledge about the Takaful concept using Shariah and Arabic terms will be dispersed as well to raise the level and understanding about Takaful in Malaysia. Even though the findings of this study are limited to the perceptions of the samples used, it is hoped that they can be useful to the Takaful companies in improving their service in an effort to create more awareness and promotion in their marketing activities to the public.
Significant to the other researcher
From this research it serves as an opportunity to the researcher to give the more detail explanation on the idea, Arabic and Shariah terms in Takaful. Researcher will has better understanding regarding concept of Takaful and gender perception.
Learn about Research Methodology to study this further because in this research a lot of practice science Research Methodology. Researcher can apply what he has learned in the subject Research Methodology to this study.
Significant to the reader
The readers can increase their information about the concept of Takaful and increase the level of understanding on the product, so that they can differentiate between the Takaful concept and conventional insurance.
The readers also can enhance new information about the relationship between gender and level of knowledge on the idea, Arabic and Shariah term in the Takaful.
SCOPE OF STUDY
This study focused on the gender perception of Muslim people in the vicinity of Klang Valley. Specifically, the study focuses on the respondents' understanding of concepts, Arabic and Shariah terms in the contract and operations of Takaful. However, awareness and participation in Takaful products are also surveyed to find out their level of understanding on Takaful in general.
LIMITATION OF STUDY
When conducting this study, researcher faced several limitations that become barriers to carry out good research project.
The main limitation of this study, the data will be gathering from a single region which is Klang Valley. It would be interesting by larger sets of data in which to extend the survey in other regional states of the country in Malaysia where the results might be more representative of the issues concerned.
DEFINITION OF TERMS
1.8.1 Knowledge
The awareness and understanding of facts, truths or information gained in the form of experience or learning. Knowledge is an appreciation of the possession of organized details which, in separation, are of lesser value.
Knowledge is a term with many meanings depending on context, but is closely related to such concepts as meaning, information, instruction, communication, representation, learning and mental stimulus.
Understanding
Having the ability to perceive or understand wholehearted in judgment a perceptive observation.
1.8.3 Gender
Sexual identity, especially in relation to society or culture.
Gender is a set of characteristics distinguishing between male and female.
1.8.4 Male
Refers to the sex of a person, or part of an individual, which produces small mobile gametes, called spermatozoa.
1.8.5 Female
Sexual characteristics of a human being or a part of an organism, which produces non-mobile ova (egg cells).
1.8.6 Perception
The process of acquiring, interpreting, selecting, and organizing sensory information. Methods of studying perception range from essentially biological or physiological approaches, through psychological approaches to the often abstract 'thought-experiments' of mental philosophy.
1.8.7 Shariah
The code of law derived from the Al-Quran .
Fatwa
The collection of rules imposed by authority civilization presupposes respect for the law of large problem for jurisprudence to allow freedom while enforcing order.
1.8.9 Level
Relative position or rank on a scale
An instrument for determining, or adjusting a surface.
1.8.10 Arabic
A Semitic language consisting of numerous dialects that is the principal language of Arabia, Jordan, Syria, Iraq, Lebanon, Egypt, and parts of northern Africa.
1.8.11 Muslim
Believer in or follower of Islam.
1.8.12 Concept
Something conceived in the mind thought, notion an abstract or generic idea generalized from particular instances.
1.8.13 List of Arabic terms and its definition in Islamic Insurance
1. Takaful: Islamic insurance provided under the principle of mutual support and help among participants.
2. Gharar : Deception involving the deliberate creation of, or exploitation of, or uncertainty in the contract of business.
3. Maysir : Gambling.
4. Riba: An addition or excess in the principal of a loan or exchange of ribawi items.
5. Mudharabah: Profit sharing contract between two parties, capital provider and entrepreneur.
6. Wakalah : Agency
7. Kafalah : Connection or addition.In the language of law, it signifies the connection of one person to another in relation to a claim.
8. Ujrah : Commission.
9. Tabarru : A portion of participant's contribution for the purpose of mutual helps and used to pay claims Submitted by eligible claimants.
10. Hibah : Gift
11. Rabbul Mal: Capital provider
12. Mudharib : Entrepreneur
13.Qard al-Hasan : Lending without interest or benevolent loan
SUMMARY
Takaful industries today will be part of this on available effort to enhance the ability of consumers to understand and draw meaningful comparisons of alternative financial products and make better informed decisions in financial planning.
The different features of the Takaful product and services have been taken into consideration to meet the information needs of insurance consumers. In addition this study also wants to formulate a consumer education strategy, among Muslim on the idea, Arabic and Shariah terms in Takaful.
Furthermore this study will examine the factors that contributed to the level of knowledge, and understanding among Muslims resting on the gender perceptive towards the idea, Arabic and Shariah terms in Takaful. This study will test either there are any difference on the level of knowledge among Muslim based on the gender viewpoint.
CHAPTER 2
LITERATURE REVIEW
INTRODUCTION
This chapter will begin with a discussion on the Takaful concept, level of knowledge, and gender perception based on the previous studies.
2.1 TAKAFUL CONCEPT
Takaful contracts are relatively new developments. The pioneer Muslims neither knew it nor was it ever considered by the earlier Islamic Jurisprudents Liaquat Ali Khan ( 2004)
2.1.1 PREVIOUS STUDY
Liaquat Ali Khan (2004) Takaful is not a new concept in Islamic commercial law. The contemporary jurists acknowledge that the foundation of shared responsibility or Takaful was laid down in the system of Aqilah, which was an arrangement of mutual help or indemnification customary in some tribes at the time of the Holy Prophet (PBUH).
Takaful contract so agreed usually involves the concepts of Mudarabah, Tabarru' to donate for benefit of others and mutual sharing of losses with the overall objective of eliminating the element of uncertainty.
While recognising the beauty behind the insurance concept, Muslim jurists (Islamic scholars) are of the opinion that the operation and structure of the conventional insurance, in its presence form, does not conform to the rules and requirements of Shariah as it embodies a number of misconceptions in its contract and operation Gharar (uncertainty) insurance contract involves the element of gharar because at the time of the contract.
The most well-known restrictions from Islamic law are related to Riba interestor usury Gharar uncertainty or sale of risk and Maysir gambling. Oliver Wyman (2007)
2.2 LEVEL OF KNOWLEDGE
Level of knowledge and understanding of people on the concept, Arabic and Shariah terms has been critical concept in contemporary marketing thought and in research related to buyer behavior Mohamad Abdul Hamid Mohd Sukki Othman (2009)
2.2.1 PREVIOUS STUDY
In a survey conducted in the UK, Omer (1992) found a high level of unawareness among Muslims with regard to what constitutes acceptable Islamic finance principles. He reported that the higher the religious commitment and the lower the level of general education, the stronger the preference for Islamic over conventional finance.
However, Haron ,Ahmad and Planisek (1994) found that the selection criteria of Muslim bank customers in Malaysia was largely based on non-religious aspects, such as service efficiency, transaction speed, and the friendliness of bank personnel. Some of the respondents indicated that religion was a prime reason for using Islamic banking services. They noted that although there was a high level of awareness of Islamic products, there was a poor understanding of the differences between Islamic and conventional banking, as well as weak knowledge regarding Islamic products and services.
These primary findings are in contrast to Metawa and Almossawi (1998) who interviewed 100 Islamic bank customers in Bahrain and found that the single most important factor for the selection of an Islamic bank is the Shariah based principles that administer these financial institutions.
Hamid and Nordin (2001) surveyed Malaysian commercial bank customers, finding a high awareness of Islamic banking but poor self-reported knowledge of specific Islamic products, including poor understanding of the difference between Islamic and conventional banking.
In another study of Malaysian commercial customers and their views of Islamic financial services, Ahmad and Haron (2002) noted that 65%of the respondents admitted to having limited knowledge of Islamic banking, while at the same time indicating that they believed the concept had good potential in the Malaysian market.
2.3 GENDER PERCEPTIVE
Gender is socially constructed based in a person's view of him or herself as possessing those qualities that society deems to be masculine, feminine, or both. However, sex is a biological classification the term refers to whether an individual is biologically and genetically male or female (Wilson, 2002) so different gender will have different opinions knowledge attitude and character.
Perception may be defined from physical, psychological and physiological perspectives. But for the purpose of this study, it shall be limited to its scope as postulated by Allport (1966), which is the way we judge or evaluate others.
PREVIOUS STUDY
Various biological, sociological and traits based explanation have been put forward for these gender differences, fisher and Arnold (1194) males and females have been postulated to employ significance different in aspect of consumer behavior, from the product tend to buy and respond advertisement and product position Buttle (1992)
The gender of consumers may have an influence on their interest in products and their expertise as to their prices which may affect the retail marketing strategy. Louise van Scheers and M C Cant (2007)
Like the clinical findings about the brain lateralization, in cognitive studies, it is also widely accepted that women excel in verbal skills Hyde & Linn, (1988), whereas men show superiority in mathematical ability (Geary, 1996 Hyde, Fennema, & Lamon, 1990) and spatial abilities (Linn & Peterson, 1986)
Gender differences in personal financial knowledge on average women know less about personal finance than men. Male participants believe that number oriented science subject are more important where female participants believe that number oriented science subject are more important non math related to humanity ( Haiyang Chen& Ronald P. Volpe)
The way individuals evaluate people with whom they are familiar in everyday life, Eggen and Kauchak (2001) gave cognitive dimension of perception they see perception as the process by which people attach meaning to experiences. They explained that after people attend to certain stimuli in their sensory memories, processing continues with perception. Perception is critical because it influences the information that enters working memory. Background knowledge in the form of schemas affects perception and subsequent learning.
SUMMARY
In this chapter 2 described the review of literature to this study. It consists on the concept of takaful, level of knowledge and the differences perception of customer between genders.
The study in this paper may be functional for the Takaful companies in their attempt to enhance their marketing and promotion activities.
CHAPTER 3
METHODOLOGY AND DATA
INTRODUCTION
Research methodology is an outline for conducting the marketing research project. It specifies the element of the procedures necessary for obtaining the information needed to formation or solving research. This chapter explains the design of this study which consists research purpose, type of investigation, and time horizon to complete this research.
This chapter also explains the collection method that will be used. This study primary data and secondary data. Primary data is used to collect first hand information about gender perspective toward level of knowledge towards the idea, Arabic and Shariah terms in Takaful. While secondary data are collected to make a write up the literature review and the background of study.
DATA COLLECTION
3.1.1 PRIMARY DATA
Information that has been collected at first hand. It involves measurement of some sort, whether by taking readings off instruments, sketching, counting, or conducting interviews the data which is collected by the researcher directly from his own observations and experiences. Primary research entails the use of immediate data in determining the survival of the market. The popular ways to collect primary data consist of surveys, interviews and focus groups, which shows that direct relationship between potential customers and the companies. Primary data takes a lot of time and the unit cost of such data is relatively high.
3.1.2 SECONDARY DATA
Whereas secondary research is a means to reprocess and reuse collected information as an indication for betterments of the service or product.
In secondary data, information relates to a past period. Hence, it lacks suitability and therefore, it has unsatisfactory value.
Secondary data is obtained from some other organization than the one instantaneously interested with current research project. The data can be obtained from internet, journals, newspaper and textbook.
SAMPLING FRAME
Sampling is the process of selecting a sufficient number of elements from the population, so that a study of the sample and an understanding of its properties or characteristics would make it possible for us to generalize such properties or characteristics of the population such as the population mean, the population standard deviation and the population variance are refer to as its parameters. The central tendencies, the dispersions, and other statistics in the sample of interest to the research are treated as approximations of the central tendencies dispersion and other parameters of the population.
THE REASON FOR SAMPLING
The reason for using a sample rather than collecting data from the entire are population is self evident. In research investigation involving several hundreds and even thousand of elements, it would be practically impossible to collect data from or test every element. Even it is potential it would be unreasonable in terms of time, cost and other human resource.
This study will be focus on 100 samples that have been chosen through convenience sampling.
SAMPLING TECHNIQUE
Sampling frame can be broadly as non probability and non probability. Probability sampling, or random sampling, is a sampling technique in which the probability of getting any particular sample may be calculated. Non probability sampling does not meet this criterion and should be used with caution. Non probability sampling techniques cannot be used to infer from the sample to the general population. Any generalizations obtained from a non probability sample must be filtered through one's knowledge of the topic being studied. Performing non probability sampling is considerably less expensive than doing probability sampling, but the results are of limited value. The examples of non probability sampling include convenience, accidental sampling, snowball sampling, judgmental sampling or purposive sampling. This study will use convenience sampling.
POPULATION
The populations are often defined in terms of demography, geography, occupation, time, care necessities, diagnosis, or some mixture of the above. The populations of the respondents will be the Muslim people, either male or female who live in the Klang Valley.
The reason for limiting the study to the Muslim people, either male or female who live in the Klang Valley.because to reduced fewer errors will therefore result in collecting data ,especially when a large number of population is involved.
RESEARCH DESIGN
Purpose of the study
According to Uma Sekaran (2006) the idea of an academic research can be investigative in nature, descriptive, or can be conducted to test hypothesis. The nature of the study depends on the stage to which knowledge about the research topic has advanced.
An exploratory is undertaken when not much is known about the situation at hand, or when information is available on how similar problems research issues have been solved in the past.
The explanatory study is undertaken in order to ascertain and be able to describe the characteristics of the variable of interest in a situation.
Hypothesis testing offers usually explain the nature certain relationship, or establish the differences among groups or the independence of two or more factors in a situation.
3.4.2 Type of Investigation
This study involves co relational types of investigation such as using Statistic Package for Social Science (SPSS) program, internet and journals.
3.4.3 Unit of Analysis
In this study the awareness, knowledge and understanding, Arabic and Syariah term with the participation of respondents either male or female are unit of analysis.
Time Horizon
This study will use yearly basis which is 2011 and only focus on the Muslim people, either male or female who live in the Klang Valley.
3.5 DIMENSION DIAGRAM
In order to resolve the problem arising from the survey, researcher has referred to several theories that have relation with the matter.
Level of knowledge and understanding among Muslim towards Arabic and Shariah term in TakafulFactor influences
Awareness
Knowledge and understanding
Arabic and Syariah Term
Participation
Figure 3.7: Dimension Diagram
According to the measurement drawing above, it can elaborated that the level of knowledge and understanding among Muslim towards Arabic and Shariah relying on the gender perception in Takaful can be verify by awareness, knowledge and understanding, Arabic and Syariah term with the participation of respondents.
MEASUREMENT
3.5.1 Awareness
Awareness is the state or ability to perceive, to feel, or to be conscious of events, objects or sensory patterns. In this level of consciousness, common sense data can be confirmed by an observer without necessarily implying understanding, Williams & Wilkins (1998)
Top of Form
To test the level of awareness among Muslims toward Takaful concept of consciousness the first part of the questionnaire will ask questions regarding the opinions of respondents on their knowledge resting on the existence of Takaful, subsequently the question will they ever go to Takaful companies in Malaysia plus how they get present the source of the Takaful either by Takaful agent or a staff, a letter newspapers, magazines, friends and relatives and the internet sources.
3.5.2 Knowledge and Understanding
The fact or condition of knowing something with fluency gained through experience or association, acquaintance with or understanding of a science, art, or technique the fact or condition of being aware of something the range of one's information or understanding answered.
This section will using Likert Scale to exchange views on the knowledge of takaful of the respondents, for an example, opinions about the riba, maisir, gharar and a vital element that exists in the takaful contract.
Implicitly, questions were designed and asked to gauge respondent's knowledge and understanding on the concepts of Takaful the existence of underlying or unconscious motives that influence consumer behavior toward Takaful product and services.
3.5.3 Shariah
Shariah way or path is the blessed law of Islam. Shariah deals with many topics addressed by secular law, including crime, politics and economics.
Different views have been expressed about the status of conventional insurance from the point of view of Islam. An overwhelming majority of the Shariah scholars believe that it is unlawful due to involvement of Riba (interest), Maisir (gambling) and Gharar (uncertainty).
3.5.3 Arabic Term
The term Takaful is derived from the Arabic word Kafaala meaning guaranteeing. Takaful means guaranteeing each other and refers to the concept of permissible Islamic insurance or Halal insurance.
Takaful, the Islamic alternative to insurance is based on the concept of social solidarity, cooperation and mutual indemnification of losses of members. It is a pact among a group of persons who agree to jointly indemnify the loss or damage that may inflict upon any of them, out of the fund they donate collectively. The Takaful contract so agreed usually involves the concepts of Mudarabah, Tabarru´ (to donate for benefit of others) and mutual sharing of losses with the overall objective of eliminating the element of uncertainty (Muhammad Ayub 2003)
This part is to know the opinion of the respondents in the use of Arabic in the Takaful and the reason for accepting Arabic and Shariah terms in the Takaful contract.
3.5.4 Participation
This part has also introduced to be observed in the questionnaire. The primary purpose of this division to identify forces and influences that consumers will participate on Takaful products. In addition this measurement typically attempts to go through all of these influences and factors to unknot the mystery of consumer behavior as it relates to a Takaful product and service, so that the marketer better understands the target audience and how to influence that audience.
3.6 DATA ANALYSIS AND TREATMENT
This research will be carried out through questionnaires. A sample 100 Muslim in Kuala Lumpur will be surveyed. All data that will be collect and will be transferred into Statistic Package for Social Science (SPSS) to be analyzed. The outcome will be in the form of frequency and t- test.
HYPOTHESIS STATEMENT
According to the mentioned research questions, the following null hypotheses were formed:
Hypothesis 1
H01: There is no difference in term of level of knowledge on the idea, Arabic and Shariah term in the Takaful concept among Muslim either male or female
SUMMARY
In the nutshell, this chapter will present the research design that will be used in this study. The study aims to decide the level of knowledge and understanding among Muslim towards Arabic and Shariah relying on the gender perception in Takaful.
This research will be done in accordance to the objective where to know how. This study will perhaps can be used by the researcher, Takaful companies and customer for them to make some decisions toward this unique products.
