An empirical study on the level of awareness, knowledge, and perception toward Takaful among Thai Muslims

Abstract

Insurance is arguably well known in Thailand since the sector has emerged in the 1800s. In modern-day, the Thai insurance sector was ranked as 27th in the world with a total premium volume of U$26 billion in 2018. However, the majority of Muslim scholars do not accept conventional insurance due to its involvement with the prohibited elements in Islam. Takaful is therefore established to be an alternative to the Muslims as well as non-Muslims. Unfortunately, the Takaful sector in Thailand has not been caught a good number of customers as well as enough attention of Thai authority. In contrast, the conventional insurance sector has received a high number of sale rate of its policy and a well-established regulation for the sector. Therefore, the researcher has motivated to investigate a real cause of the problem. It is reported that lacking awareness is one of the critical factors which constrains the growth of the Takaful sector around the world. This research is hence formed its objective to examine awareness of Takaful among Thai Muslims. Furthermore, the aims of investigating the level of knowledge and perception toward Takaful are also added since the information is still unknown in the country and it will surely assist the industrial players to adapt their business strategies in order to better tackle with the issue. Consequently, the quantitative method is adopted by using a self-administered questionnaire on a total number of 198 Thai Muslims who live across the country. The data is analyzed by using Statistical Package for the Social Science (SPSS) and the result indicates that the respondents obtain relatively low knowledge regarding Takaful. Whereas, the majority of them do not have a bad perception toward Takaful. Awareness-wise, the respondents are reported to possess a low-middle level of Takaful awareness. In addition, the research further adopts the T-test and ANOVA to analyze a significant relationship between each aspect of awareness and demographic variables. As a result, gender, marital status, age and education factors show significant relation with the level of awareness on Takaful. Thus, it is advisable for the Takaful operators to pay more attention on the stated factors. Moreover, the researcher agrees that if the Thai Muslims are given a proper education on Takaful concept, the Takaful penetration rate will be inevitably improved. Eventually, it will grab the attention of the responsible authority.