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Determinants of Customer Perception about adoption of Islamic Insurance (Takaful) in Pakistan

Author

Listed:
  • Areeba Khan
  • Hafiz Abdur Rashid
  • Rana Muhammad Shahid Yaqub
  • Saba Abbas

Abstract

The purpose of this study is to assess the response level of individuals concerning Islamic Insurance in Pakistan and to measure its outreach and most pertinent factors affecting customer selection of Islamic Insurance. It also seeks to make informed recommendations on empowering frameworks for the establishment of Takaful insurance through relevant marketing campaigns in Pakistan. The impact of factors like Customer Awareness, Consumer Satisfaction, Risk Perception, Compatibility and Religiosity was checked on Adoption of Islamic Insurance in Pakistan, with the presence of Social Influence as a mediating variable. Data were collected through questionnaire administered to 300 respondents, representing the Muslim community from urban as well as rural areas, of Pakistan. Partial least square-structural equation modeling (PLS-SEM) through Smart PLS3 was used to examine the relationships among pertinent factors in this study. The findings suggest that most respondents are either not aware of Takaful as an insurance and investment option, or do not understand the concept altogether. This study suggests that Islamic insurance organizations should focus on awareness campaigns as an essential marketing strategy and dedicated resources to reach prime customer segments in general and fulfil the need to inform people about their products and services through clear understanding of principles of Shariah compliance. The findings of this research have important implications for Takaful companies as well as regulators and general insurance customers.

Suggested Citation

  • Areeba Khan & Hafiz Abdur Rashid & Rana Muhammad Shahid Yaqub & Saba Abbas, 2020. "Determinants of Customer Perception about adoption of Islamic Insurance (Takaful) in Pakistan," Journal of Business and Social Review in Emerging Economies, CSRC Publishing, Center for Sustainability Research and Consultancy Pakistan, vol. 6(4), pages 1505-1516, December.
    • Handle: RePEc:src:jbsree:v:6:y:2020:i:4:p:1505-1516
    DOI: http://doi.org/10.26710/jbsee.v6i4.1485
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    Cited by:

    1. Luhui Hua & Zeeshan Rasool & Muhammad Akbar Ali Ansari & Ali Junaid Khan & Nadia Hanif & Waseem Ul Hameed, 2023. "International Students’ Nostalgic Behaviour towards the Purchase of Products and Services," Sustainability, MDPI, vol. 15(4), pages 1-18, February.

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