Public Awareness, Knowledge, and Perception Towards Takāful in Afghanistan

Abstract

Abstract

 

The history of insurance in Afghanistan goes back to the 1960s with a recorded 2019 premium volume of USD 18.5 million and almost 40,000 policy holders from across the country. On the other hand, Afghanistan is among the countries which have not been adopted the Takāful business yet. However, a legal framework for Takāful has been developed recently and in near future, Takaful products are going to be launched. Therefore, this research examines the awareness and knowledge level of the public towards Takāful in Afghanistan. In addition, public perception has also been investigated to understand how the Afghan public perceives Takāful. In this study the quantitative method is adopted through self-administered questionnaire which were distributed to 200 respondents from the public of Afghanistan. The data collected was analysed using Statistical Package for Social Science (SPSS) version 25 and Microsoft Excel. The findings of the research indicate that the knowledge level of public of Afghanistan on Takāful is relatively good while the awareness level is low-middle. However, the majority of respondents are willing to contribute and subscribe to Takāful. Linear multiple regression analysis was used and found that both independent variables, i.e. awareness and knowledge, are statistically significant with 95% confidence in influencing public perception towards Takāful. This research provides some suggestions and recommendations for the betterment, development and improvement of Takāful in Afghanistan. The findings of this study are expected to provide guidelines for policy makers in Afghanistan as the results may also motivate the financial industry players to promote and develop their Takaful business strategies.