Muslim intention to participate into family takaful scheme : a study using decomposed theory of planned behavior in Klang Valley, Malaysia

Abstract

Malaysian takaful market has been established more than 25 years ago. However, untapped market still exists. Besides, the penetration rate and contribution from society in the country are lower compared to other countries. With so many family takaful schemes available, it is questionable why the majority of Muslims, the main target market for family takaful scheme, do not have any family takaful scheme. This resulted into finding out what factors play important role in participating into family takaful scheme. The objective of this study is to discover the factors driving consumer intention to participate in family takaful scheme. A framework was developed based on the literatures. A questionnaire and semi-structured interviews were conducted. Structural equation modelling through SmartPLS was conducted to test all the hypotheses in this study. Furthermore, the interview data were analysed through thematic analysis. The findings of this study largely supported the hypothesised relationships proposed in the theoretical model. Specifically, the results revealed that attitude and perceived behavioural control, but not subjective norm, were crucial in affecting intention to participate in family takaful scheme. The results also provided strong evidence of the relationship between media referent and word of mouth referent on subjective norm as well as between self-efficacy and resource facilitating condition on perceived behavioural control, which in turn were necessary determinants of intention. Furthermore, awareness, knowledge, experience, and religiosity were found to be associated with attitude. Knowledge and exposure were also found to have a positive relationship with intention. However, awareness and religiosity were found to have negative relationship with intention. The findings of this study provide important insights to the takaful operator in designing their product mix and in defining their target market. The findings will also assist in improving the market share of family takaful scheme and further in helping in the development of takaful industry.