The Garden of Knowledge

بسم الله الرحمن الرحيم

14 Jumaadul Thaani 1447/05 December 2025

All praise is due to Allah, the Cherisher, Sustainer, Nourisher and Provider of the entire creation. May peace, blessings and salutations be upon our Beloved Prophet Muhammed ﷺ.

Article of choice to review: Socio-economic justice and protection of wealth via Malaysian takaful operations: An analysis from material, immaterial effects and theoretical framework development. (Hafiza Harun). Article found in International Journal of Advanced Research · April 2018

SUMMARY

The analysis of this study primarily focuses on the implications of applying Islamic financial principles to the Takaful operators themselves, both material and non-material in nature.

A key concept of wealth management is wealth protection/preservation which has its own unique role. Takaful is one unique feature and product of wealth protection. From the Prophetic ﷺ teachings we recall an incident where a man with a camel approached the Prophet Muhammed ﷺ and asked if he should leave the camel loose and have tawakkul (faith in Allah) or if he should tie the camel and have tawakkul. The Prophet Muhammed ﷺ responded and informed him to tie his camel and have tawakkul. (Sunnan Tirmidhi 2517). The hadith teaches on the importance of tawakkul, however at the same time encourages risk mitigation.

Islamic wealth management would include strategies and methods to protect and build wealth for different segments of the community and offer a strong framework for its transfer in a Shariah compatible fashion.

According to Bank Negara Malaysia’s (BNM) Annual Takaful Statistics 2015, Malaysian Takaful Operators granted 4,112,556 certificates (TOs). This certificate issuance represents a contribution sum of RM 13,769,312,421.

The article highlighted the applicability of the underlying principles of Shariah such as the prohibition of riba (usury), maysir (gambling) and gharar (excessive uncertainty), all of which are naturally found within the traditional insurance framework. The article proceeds to outline the importance of all activities involved in the Islamic financial arrangement should be permitted within the framework of Shariah. Commodities that involve alcohol, pork and other religiously prohibited activities are strictly forbidden. In the case of takaful, business operations which match the description of prohibited activities cannot be underwritten.

The article further provides clarity that money is not a commodity and it is a medium of exchange hence one cannot make money from money according to the principles of Shariah.

We find that one of the key outcomes of takaful is not to provide material benefit to participants rather it is to fulfil the Maqaasid (objectives) of the Shariah (Preservation of Din, life, lineage, wealth and intellect) and promote social security.

Immaterial effects of features such as takaful usually is based on Shariah Governance an provides and outlines an ethical framework to be followed.

The authors propose a theoretical framework which would serve the needs of the participants and aims to achieve ultimate success and happiness.

CRITIQUE OF RESULTS AND DISCUSSION & CONCLUSION

 The article was aimed at socio-economic justice and the protection of wealth through the lense of takaful. The discussion included the material and immaterial effects for Takaful Operators thereafter proposed that consumer power and happiness is also centralized around religious influence. The goal is to ensure the ultimate happiness however with the religious influence taken into consideration, takaful operators cannot be dependent on it as a selling point as most consumers are price sensitive.

The discussion was well supported but personally I felt the lack of importance placed on consumer satisfaction and price sensitivity. Takaful is supposed to be a system to benefit all of humanity and not just Muslims. The product and consumer satisfaction is to be the selling point as well as Shariah Compliance.

We ask Allah to accept our efforts from us and grant us understanding In Sha Allah!