TAKAFUL INSURANCE AND ITS IMPACT ON COMMUNITY SUPPORT AND FINANCIAL STABILITY
Keywords:
Key words: Takaful insurance; Islamic finance; Risk management; Mutual cooperation; Sharia compliance; Family takaful; General takaful; Ethical finance; Financial inclusion; Regulatory framework; Community support; Surplus distribution; Islamic principles; Cooperative model; Social welfare.Abstract
This article explores the concept of takaful insurance and its significant role in enhancing community support and promoting financial stability. Takaful, rooted in Islamic principles, operates on the foundations of mutual cooperation and risk-sharing, distinguishing it from conventional insurance models. By pooling resources, takaful fosters a sense of solidarity among participants, providing them with essential financial protection while simultaneously strengthening community bonds. The article examines the mechanisms through which takaful contributes to social welfare, particularly in underserved populations where access to traditional insurance may be limited. It highlights the potential of takaful to empower communities by facilitating financial inclusion and encouraging responsible financial practices. Additionally, the article addresses the challenges faced by the takaful industry, including regulatory hurdles and competition, and discusses opportunities for growth through technological advancements and increased awareness. Through a comprehensive analysis, this article underscores the transformative impact of takaful insurance not only as a financial instrument but also as a vehicle for fostering community resilience and stability. By promoting ethical finance and social responsibility, takaful has the potential to reshape the landscape of risk management, contributing to a more equitable financial ecosystem.
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