What types of Takaful are there?
There are two main types of Takaful: Family Takaful and General Takaful.
(Do click the links to our other insurance Guides to learn more about what to think about when choosing a policy.)
Family Takaful (similar to Conventional Life Insurance)
Like conventional insurance, you can get a whole Family Takaful plan or a term Family Takaful plan.
- In a Family Takaful plan, you can get a protection plan which covers you for a fixed period when you pass away or if you become disabled.
- A whole Family Takaful plan gives you financial protection in case of a tragedy while providing long-term savings. A part of your monthly contributions will be contributed to a saving plan. When the certificate expires, you will have some savings. If you become disabled or pass away before the certificate matures, you or your beneficiary will be given funds from your Takaful operator.
Investment-linked Takaful (similar to Conventional Investment Linked Insurance)
An investment-linked Takaful plan is a combination of Takaful coverage and investment. You choose how much of your contribution goes to your coverage, which includes death and disability. The rest is invested in a Shariah-approved investment fund that you choose. Each Takaful operator offers different options of funds to invest in.
Medical and Health Takaful (similar to conventional Medical Insurance)
A Medical and health Takaful plan covers the cost of medical treatment in hospitals, including surgery and hospitalisation. You could get this plan on its own or as an add-on (rider) to a basic Family Takaful plan.
Child Education Takaful (similar to conventional Education Endowment Policy)
Child education Takaful is a long-term savings plan to finance your child’s higher education. It also provides financial aid to your child if something happens to you (disability or death).
Motor Takaful (similar to motor insurance)
Motor Takaful covers you for loss or damage to your vehicle from an accident, theft, or accidental fire. Like conventional motor insurance, a comprehensive Takaful plan will cover any injury or death of a third-party and loss/damage of their vehicle.
Home Takaful covers your house in case of a flood, fire and most natural disasters.
Personal Accident Takaful
Personal accident Takaful is generally a plan that provides you or your beneficiary some compensation in case something happens to you. This includes disablement, injuries from an accident or even death.