South Eastern University community’s perception on Takaful: an empirical study based on Oluvil campus

Abstract

Takaful which can be called as Islamic insurance has been introduced as an alternative to the conventional insurance. It is based on the principle of Tabarru and is free from the interest and uncertainties which are prohibited in the Shariah for its followers. As such, the objective of this paper is to examine the perception on Takaful among the people in the South Eastern University that is located in Oluvil, Sri Lanka. Further, the study attempts to identify reasons and factors that the South Eastern University Community has a negative perception on Takaful. For this purpose, a quantitative method is adopted. The samples were randomly selected and questionnaires were distributed for collecting data. Based on primary and secondary data, the study finds that the majority of the respondents do not understand as to what Takaful is. Despite that, they prefer Takaful to conventional insurance. The study concludes with suggestions and recommendations which are expected to be fruitful to the Takaful companies in Sri Lanka for their future endeavours.