Introduction
Most Malaysians understand takaful as a Shariah-compliant alternative to conventional insurance — a system based on cooperation (ta‘āwun) and shared responsibility. But few realize that the next stage of takaful’s evolution goes beyond compliance. This is where Value-Based Intermediation for Takaful (VBIT) comes in: it’s about ensuring every takaful product, process, and practice generates real, positive impact for people, communities, and the planet — not just profits.
VBIT transforms the way takaful products are designed, distributed, and delivered, embedding purpose into everyday insurance coverage.
1. From Compliance to Conscious Value Creation
Traditionally, takaful operators focused on ensuring that products avoid prohibited elements such as riba (interest), gharar (excessive uncertainty), and maysir (gambling). This ensures Shariah compliance — but VBIT asks a deeper question:
“Is this product truly delivering value and improving people’s lives?”
For example:
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A hospitalisation plan under VBIT isn’t just about paying claims; it’s about supporting health resilience — encouraging preventive care, wellness programs, and affordable access to medical services.
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A family takaful plan can incorporate financial education and charity-linked benefits that strengthen social welfare beyond policyholders themselves.
This shift transforms takaful from being a mere financial safety net into a force for positive societal change.
2. Product Design with Purpose
Under VBIT principles, takaful operators evaluate product ideas through ethical, social, and environmental lenses. Instead of asking, “Will this product sell?”, the question becomes, “Does this product create meaningful, sustainable value?”
Practical examples include:
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Micro-Takaful Products: Low-cost plans designed to cover the B40 income group or gig workers who are typically uninsured.
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Green Takaful: Protection for renewable energy systems, electric vehicles, or flood-risk mitigation, aligning with Malaysia’s sustainability goals.
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Education & Child Protection Plans: Policies that include scholarship funds or community learning benefits for orphans and underprivileged children.
Such innovation directly reflects the VBIT thrusts of Community Empowerment, Financial Resilience, and Best Conduct.
3. Ethical Distribution & Agent Conduct
Everyday takaful interactions — from sales to claims — are opportunities to uphold value-based principles. VBIT emphasizes that agents, brokers, and intermediaries must act as trusted advisors, not just salespeople.
That means:
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Recommending products genuinely suited to customers’ needs.
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Explaining benefits transparently, without misleading comparisons.
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Prioritizing long-term relationships over one-time commissions.
To encourage this, some takaful operators now integrate VBIT-aligned training for agents, focusing on empathy, ethics, and impact measurement. This builds trust and enhances customer satisfaction — key pillars of sustainable business.
4. Value-Based Claims & Service Culture
Claims are the “moment of truth” in any insurance product — and in VBIT, this process reflects ihsan (excellence) and amanah (trustworthiness).
A VBIT-aligned takaful operator goes beyond technical approval or rejection. It ensures that:
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The claims process is transparent and humane, with empathetic communication and simplified procedures.
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Participants’ welfare is prioritized — for example, offering additional counselling, medical guidance, or financial assistance during hardship.
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Data from claims is analyzed to improve prevention — e.g., health awareness campaigns, accident-prevention partnerships, or workplace safety programs.
This reinforces the maqasid al-Shariah objective of preserving life and wealth (hifz al-nafs and hifz al-mal).
5. Community Empowerment Through Everyday Coverage
A major thrust of VBIT is Community Empowerment — the belief that takaful should contribute to collective well-being. Everyday products can be structured to channel part of participants’ contributions or surpluses to community impact initiatives.
Examples:
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Surplus Sharing for Good: A portion of underwriting surplus can fund community clinics, education drives, or disaster relief efforts.
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Participant Solidarity Funds: Members of certain group takaful schemes can agree to allocate small percentages of contributions to assist others in dire need.
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Wellness Partnerships: Health takaful products can sponsor community health screenings or preventive care campaigns.
These small, consistent acts of giving embody tabarru‘ — the spirit of donation — in its truest form.
6. Integrating ESG and Sustainability Goals
VBIT naturally aligns with Environmental, Social, and Governance (ESG) values. For everyday takaful products, this means:
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Screening investments to avoid harmful industries (e.g., tobacco, gambling, deforestation).
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Promoting sustainable projects, such as solar financing or waste-reduction initiatives.
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Encouraging customers to make eco-friendly choices (e.g., premium discounts for electric vehicles or healthy lifestyles).
By embedding ESG thinking, takaful operators can position themselves as leaders in ethical finance, attracting conscious consumers and global investors.
7. Measuring Impact and Transparency
VBIT calls for operators to measure what truly matters — not just total premiums collected or claims paid, but the real-world impact of their products.
Key indicators might include:
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Number of low-income families covered.
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Amount of claims paid within 7 days.
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Participants assisted through community programs.
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Carbon footprint of investment portfolios.
Public reporting of these metrics builds transparency, accountability, and brand credibility — reinforcing the Good Self-Governance thrust of VBIT.
8. The Customer Experience: Trust, Clarity, and Care
For everyday consumers, VBIT means better experiences at every touchpoint:
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Clear, jargon-free product explanations.
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Fair pricing and transparent surplus-sharing mechanisms.
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Responsive customer service grounded in empathy and respect.
In essence, when customers buy a VBIT-aligned takaful plan, they are not just protecting themselves — they’re participating in a system that cares for society.
9. Challenges and Opportunities Ahead
Embedding VBIT into everyday products isn’t without challenges. Operators need to retrain staff, invest in impact-measurement systems, and rethink product design. Consumers, too, must be educated on what value-based insurance means and why it matters.
However, as awareness grows, VBIT will likely become a competitive advantage. Policyholders increasingly prefer brands that demonstrate integrity, sustainability, and compassion — values that are at the heart of both Islam and modern ethical finance.
Conclusion
VBIT is not a distant policy framework; it’s a living principle that shapes how every takaful policy is created, sold, and served. When embedded deeply into everyday takaful products, it ensures that protection goes hand-in-hand with purpose — helping Malaysians achieve security while uplifting the communities and environment around them.
In simple terms, Value-Based Intermediation transforms takaful from “insurance that avoids the haram” to “insurance that actively does good.”
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