All You Should Know About Takaful

Posted on: 20th Oct 2020

What Is Takaful?

Takaful is a policy of mutual co-operation, solidarity, common interest, shared responsibility, joint indemnity and brotherhood against unpredicted risk or catastrophes, in which the participants involved are expected to contribute genuinely.

Takaful in Arabic means “Joint Guarantee”. It provides policyholders with the self-discipline for savings and investment and encourages the habit of sound financial planning to take care of themselves and the needs of their children and families.

A Family Takaful Plan is an ethical insurance product that combines long-term savings, investment, and financial protection meant to cater for future contingency needs.

Objectives of Family Takaful Plans are:

• To save regularly for a fixed period with a view of creating a contingency fund for future needs such as retirement, children education, Hajj etc.
• To invest with a view of earning profits in a manner acceptable to the principle of shariah, this, in turn, will lead to further accumulation of savings.
• To obtain cover in the form of mutual financial aid from payment of Takaful benefits to the heir(s) should a participant die before the maturity of his Takaful Plan.

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