Factors influencing the penetration rate of Malaysian takaful industry from takaful managers’ perspective
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The Malaysian Takaful industry has experienced encouraging growth since its inception in 1985. Annual growth rate of the industry has been estimated to be around 20%. Despite such impressive rate of growth, it is believed that the market penetration of Takaful is still low. This paper seeks to find the factors influencing Takaful market penetration based on the experience of managers of Takaful operators. Twenty (20) Takaful managers were randomly selected and interviewed. The interviewees pointed out the factors that deter the public from participating in Takaful could be listed as follows: the lack of public awareness in the advantages of Takaful over insurance products, the limited range of product varieties, the shortage of relevant expertise to explain Takaful products, the need to improve the distribution channels and marketing strategies. The paper also suggested several ways of improving Takaful market penetration, namely: the need to develop tailor-made products to suit customer needs according to the different segments of the society, expanding the range of product varieties, extensive training of staff and agents to enhance their products and services, technical and Shari’ah knowledge as well as to intensify promotion for higher level of awareness.
Penetration rate , Malaysian , Takaful industry , Managers
Mohamed, Omaima Eltahir Babikir, Alhabshi, Syed Othman & Sharif, Kamaruddin. (2013, December 3-4). Factors influencing the penetration rate of Malaysian takaful industry from takaful managers’ perspective. In 4th International Conference on Business and Economic Research (4th ICBER 2013) Proceedings. Paper presented at 4th International Conference on Business and Economic Research (4th ICBER 2013), Golden Flower Hotel Bandung, Indonesia (pp. 353-366).