Introduction to takaful insurance in the Malaysian construction sector

Research output: Contribution to specialist publicationArticle


Muslims are required to anticipate the potential for future loss of earnings and take precautions to mitigate it. The concept of mitigating risks by taking safety precautions to avoid loss and damage is emphasised in the Quran.

In Islam, risks are managed through risk sharing, which is the practice of not placing one's future in the hands of others, but rather taking steps to protect oneself against future risks and difficulties while still placing one's trust in the Lord. This is accomplished through a protection scheme such as takaful, which is Shariah-compliant insurance.

In the context of Islamic financial transactions, risk implies several meanings, such as exposure or loss due to unpredictable events in future. This has led people to find ways of mitigating risk or to seek protection and guarantee for compensation, should it occur, through the procurement of insurance.

Due to their complexity, construction projects are exposed to high levels of risk. As a result, risk mitigation in construction is critical to ensuring losses are controlled and works are to be completed as planned. Traditionally, there have been a number of methods for risk mitigation: avoidance, reduction, retention, transfer and sharing.
Original languageEnglish
Specialist publicationRICS Construction Journal
Publication statusPublished - 21 Apr 2022


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