TAKAFUL DEFINITION
In Arabic word, the root word of takaful is kafala. It means guarantee or safeguard. The word ‘takafal’ whose chief characteristic is ‘al-syarikah’ means sharing. Therefore, the word ‘takaful’ means shared responsibility or shared guarantee, responsibility, assurance or surety’. Technically, takaful means mutual guarantee provided by a group of people living in the same society against a defined risk or catastrophe befalling one’s life, property or any form of valuable things’. Takaful is also known as a cooperative insurance.
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