Integration of Absolute Assignment in the Takaful Industry and its Implications on Islamic Estate Planning

Muhamad Muizz Abdullah, Mohd Izzat Amsyar Mohd Arif, Aiman Amalina Abd Manaf, Muhammad Farid Sabri

Abstract


One of the important aspects of takaful is the use of Absolute Assignment which allows the transfer of full ownership of takaful benefits to the trustee. However, the implementation of the Absolute Assignment in the context of Islamic estate planning‎ is still unclear and will affect to the inheritance conflicts. Therefore, this study will analyze the extent to which the integration of the Absolute Assignment can be implemented in the Islamic estate planning industry, especially involving the appointment of trust institutions as a trustee. This study is qualitative by using the content analysis method on journal articles, books, acts and court cases. Interview were also conducted with representatives of two trust institutions in Malaysia, namely Amanah Raya Berhad (ARB) and as-Salihin Trustee Berhad, to find out about estate planning products that use Absolute Assignment. In addition, an interview was also conducted with a takaful practitioner from Takaful Ikhlas company to learn more about the implementation of the Absolute Assignment. In conclusion, this study found that there are four main implications through the integration of Absolute Assignment in the takaful industry, namely speeding up the estate administration process, helping to ease the cost burden, safeguarding the welfare of beneficiaries and free tax of takaful benefit. This study suggests that an active collaboration should be implemented between takaful companies and trust institutions in Malaysia to produce variations of takaful products based on Islamic estate planning.

Keywords


Absolute Assignment, takaful, implication, trust institution, Islamic estate planning

References


AAOIFI. Sharī'ah standards for Islamic financial institutions. Bahrain: n.p, 2010.

Abd Hamid, Mohamed Hadi & Hassan, Rusni. “Akta Perkhidmatan Kewangan Islam ‎‎2013: Tinjauan Awal Kesannya Dalam Industri Takaful,”. Kanun- Jurnal Undang-Undang ‎Malaysia, vol. 26, no 2 (2014).

Abdullah, Muhamad Mu’izz, “Wasiat Beramanah: Alternatif Kepada Perancangan Harta ‎Pusaka Yang Komprehensif Di Malaysia,” Journal of Islamic Philanthropy & Social ‎Finance, vol 5, no 1 (2023).

Abdullah, Muhamad Mu’izz. Awang, Abdul Bari. Nor Muhammad, Nasrul Hisyam. “Wiṣāyah Dan ‎Amanah: Analisis Perbandingan Undang-Undang Syariah Dan ‎Sivil Dalam Perancangan Harta Pusaka,” Jurnal Syariah, vol. 2, no 28 (2020).‎ https://doi.org/10.22452/js.vol28no2.2

Abdullah, Muhamad Mu’izz. Mohamad, Mohamad Fadzil. Yaakob, Muhaimin. “Pelaksanaan Amanah ‎Takaful Di Malaysia: Analisis Menurut Perspektif Maqasid ‎Syariah,” Journal of Islamic, Social, Economics and Development, vol. 5 no. 30 (2020).

Abdullah, Muhamad Mu’izz. Othman, Amirul Hafizin & Mohamad, Mohamad Fadzil. “Transformation of ‎Collateral Hibah in Amanah Raya Berhad: Analysis from the Shariah ‎Perspective and its Implementation in Malaysia,” IIUM Law Journal vol 32, no 1 (2024).‎ https://doi.org/10.31436/iiumlj.v32i1.953

Ahmad, Mohd Kamil & Borhan, Joni Tamkin, “Penggunaan Hibah Bersyarat (Bertaʻlīq) Dalam ‎Masalah Pembahagian Manfaat Takaful: Analisis Hukum,” Jurnal Syariah vol 25, no 1 (2017).‎ DOI: https://doi.org/10.22452/js.vol25no1.3

AIA Takaful, "Absolute Assignment," accessed on Jun 2, 2024. https://www.aia.com.my/content/dam/my/en/docs/forms/aiabhd/penyerahan-hak-mutlak.pdf.

AM Metlife Takaful, "Absolute Assignment," accessed on Jun 2, 2024. https://www.ammetlifetakaful.com/getattachment/0de0d962-bace-4a86-8379-231bd4d881d8/DocumentName.aspx.

Amanah Raya Berhad, “Mengenai Amanah Raya Berhad,” retrieved on Jun 2, 2024. https://www.amanahraya.my/ms/tentang/tentang-amanah-raya-berhad,

Aniroh, Reni. Nasution, Nur Khoiruddin & Sodiqin, Ali. “The Bilateral Inheritance System in Islamic Family Law: Fairness, Equality, and Mutual Exchange Perspectives.” Samarah 8, no. 2 2024, p. 891–911. https://doi.org/10.22373/sjhk.v8i2.17630.

As-Salihin Trustee Berhad, "About As-Salihin," retrieved on Jun 2, 2024.https://as-salihin.com/en/tentang-as-salihin/.

Awang, Abdul Bari. Abdullah, Muhamad Mu’izz. Abdullah, Nasrul Hisyam. (2022). "The Analysis Of Trust As An Islamic Estate Planning Instrument In Malaysia: Challenges And Effects," UUM Journal of Legal Studies vol 1, no. 1.‎ https://doi.org/10.32890/uumjls2022.13.1.5

Azalan, Nurul Syuhadah & Mohamed Said, Noor Lizza, “Keputusan Hakim Syarie Dalam ‎Kes-Kes Pengesahan Hibah Ruqba,” Journal of Contemporary Islamic Law ‎vol 1, no 2 (2016).‎

Bachri, Syabbul. “Rekonstruksi Kewarisan Islam: Studi Hermeneutika Ibn Abbas Atas Ayat-Ayat Waris.” Al-Istinbath: Jurnal Hukum Islam 5, no. 1 2020. https://doi.org/10.29240/jhi.v5i1.1197.

Elfia, Meirison & Muhammadi, Qasim. “Distribution of Heritage Association of Harta Pusaka Tinggi And Harta Pusaka Rendah in Padang Pariaman.” Al-Ahkam 30, no.1 (2020). https://doi.org/10.21580/ahkam.2020.30.1.5273.

BNM, "Financial Sector Participants Directory,", accessed on May 31, 2024, https://www.bnm.gov.my/regulations/fsp-directory?

Elfia, Nurus Shalihin. Surwati. Fajri ,Yan & Rahmat, Aulia. “Institutionalizing Maqāsid Hifz Al-Nasl within the Minangkabau Inheritance Framework.” Ijtihad: Jurnal Wacana Hukum Islam Dan Kemanusiaan 24, no. 2 2024. https://doi.org/10.18326/IJTIHAD.V24I2.193-222.

Gessaman, Paul H., "Life Insurance as an Estate Planning Tool," Library Philosophy and Practice (e-journal), (1996).

Halim, Akmal Hidayah & Ahmad Bustami, Tajul Aris. “Pelaksanaan Hibah Amanah ‎Sebagai Suatu Instrumen Pengurusan Harta Islam Di Malaysia,” ‎Kanun vol 29, no 2 (2017).

Hamdani. Satria, Fahmi Fatwa Rosyadi. Pebrianti, Suci. Dzulhijjah, Liza & Maricar, Hudzaifah Muhammad. “Traditional Law vs. Islamic Law; An Analysis of Muslim Community Awareness in Inheritance Issues.” Al-Ahkam 32, no. 1 2022. https://doi.org/10.21580/ahkam.2022.32.1.11000.

Hassan, Hafiz Ali. "Takaful Models: Origin, Progression and Future," Journal of Islamic Marketing, vol. 11, no 6. (2020). DOI: 10.1108/JIMA-04-2018-0078

Hasan, Muhammad Ibnul & Khoiriyah, Rosyidatul. “Gugatan Harta Waris Terhadap Anak Angkat Analisis Yuridis Terhadap Putusan PA Situbondo No. 0371/Pdt.G/2017/PA.Sit.” Al-Istinbath: Jurnal Hukum Islam 4, no. 2 2019. https://doi.org/10.29240/jhi.v4i2.949.

Hasan, Muhammad. “Construction of Modern Islamic Inheritance Law Based on Ijtihad of the Judges at the Religious Court of Pontianak, West Kalimantan.” Samarah 7, no. 2 2023. https://doi.org/10.22373/sjhk.v7i2.8852.

Ibrahim, Ahmad Basri & Mohd Ali, Ahmad Fadhil Hamdi. "Absolute Assignment in Takaful Industry: Shari'ah Contracts, Issues and Solutions," Intellectual Discourse, 23 (2015).‎ https://doi.org/10.31436/id.v23i0.697

Jamil, Siti Norshila & Jamal, Jasri, "Importance of Islamic Financial Services Act 2013 in Takaful Industry After the Repelled Takaful Act 1984," Diponegoro Law Review, vol. 1, no 1 (2016). DOI: https://doi.org/10.14710/dilrev.1.1.2016.17-27

Kamarudin, Mohd Khairy. Abdullah, Azwan. Mohamad, Siti Fariha. "Nomination Practice In Malaysia: A Review On The Requirements And Conditions From Islamic Perspective," Intercontinental Journal Of Finance Research Review, no. 3 (2015).

Kambol, Rositah. “Pengurusan Harta Orang Islam Melalui Hibah: Isu dan ‎Penyelesaian,” Journal of Law & Governance vol 2, no 1 (2019).

Lanctot, "What Is a Life Insurance Assignment?", accessed on May 31, 2024, https://finance.zacks.com/absolute-assignment-life-insurance-policies-6460.html.

Mahmud, Mohd Sadad & Abd Kader, Radiah. “Perkembangan Takaful di Malaysia : Satu Kajian ‎Undang-Undang ‎Kewangan Islam,” Kanun Jurnal Undang-Undang Malaysia, vol. 24, ‎no 2 ‎(2012).

Maimanah, M. Fahmi Al-Amruzy. Siti Faridah & Arni. “Delay in the Division of Inheritance: A Theoretical Review Within Legal System Framework in Indonesia.” Syariah: Jurnal Hukum Dan Pemikiran 24, no. 1 (2024). https://doi.org/10.18592/sjhp.v24i1.12916

Maithreyi, "Assignment" explained in Insurance Policy terms," accessed on Jun 2, 2024. http://finmantra.co.in/blog/2018/06/29/assignment-explained-in-insurance-policy-terms/.

Mohamed Said, Noor Lizza. Wan Ayub, Wan Amirul Adli. Muda, Mohd Zamro. Adnan Yusoff, Mohamed. Mohd Kashim, Mohd Izhar Ariff. (2019), “Pengamanahan Dalam Perancangan Dan Pengurusan ‎Harta Orang Islam,” Islamiyyat vol 41, no 2.‎ https://doi.org/10.17576/islamiyyat-2019-4001-08

Mohd Noor, Azman & Abdullah, Mohamad Asmadi. "Takaful (Islamic Insurance) Benefit: Ownership and Distribution Issues in Malaysia," Journal of Islamic Economics, Banking and Finance, vol. 5, no 3 (2009).

Muda, Mohd Zamro. Rosdi, Nurnazirah & Mohamed Said, Noor Lizza. “Analisis Perundangan dan Kes Hibah ‎Amanah di Malaysia,” International Journal of Islamic Thought vol 23, no 1 (2023).‎ https://doi.org/10.24035/ijit.23.2023.258

Muda, Resali, “Harta pusaka Islam di Malaysia: Antara Perundangan dan Pentadbiran,” ‎Malaysian Journal of Syariah and Law, vol 4, (2016).‎

Munawar. “The Legality of Smart Contract in the Perspectives of Indonesian Law and Islamic Law.” Al-Istinbath: Jurnal Hukum Islam 7, no. 1 (2022). https://doi.org/10.29240/jhi.v7i1.4140

Noor, Azman Mohd & Zakaria, Mohamad Sabri. “Takaful : Analisis Terhadap Konsep dan Akad,” Jurnal Muamalat, vol 3, (2010).

Noordin, Nazrul Hazizi. Ismail, Muhammad Issyam. Abd Rahman, Muhammad Abd Hadi. Haron, Siti Nurah and Abdullah, Adam. “‎Re-Evaluating the Practice of Hibah Trust in Malaysia,” Humanomics vol 32, no 4 (2016).‎ DOI: 10.1108/H-05-2016-0044

Nor Muhamad, Nasrul Hisyam, “Wasiat Sebagai Instrumen Perancangan ‎Harta Islam: Prosedur Dan Pelaksanaan,” Jurnal Hadhari vol. 9, no 1 (2017).

Pru BSN, "Absolute Deed of Assignment," accessed Jun 2, 2024. https://www.prubsn.com.my/export/sites/prudential-pbtb/ms/.galleries/pdf/61301001-Absolute-Deed-of-Assignment-24-5-2019.pdf.

Rasyid, Arbanur. Lubis Rayendriani Fahmei & Saleh, Idris. “Contestation of Customary Law and Islamic Law in Inheritance Distribution: A Sociology of Islamic Law Perspective.” Al-Ahkam 34, no. 2 2024. https://doi.org/10.21580/ahkam.2024.34.2.20843.

Roslan, Nur Fadlin & Ahmad, Azlin Alisa. “Pentadbiran Harta Pusaka dan Implikasi Negatif ‎Harta Tidak Dituntut,” Malaysian Journal of Social Sciences and Humanities, vol 7, no 4 ‎(2022). Doi: 10.47405/mjssh.v7i4.1453.

Saifullah, ‘Ainan Husnaa Muhammad & Mahamood, Siti Mashitoh. “Isu-Isu Berbangkit Dalam Pengurusan Harta ‎Pusaka Ringkas Secara Berwasiat Dan Tidak Berwasiat Di Amanah Raya ‎Berhad (ARB),” Journal of Shariah Law Research vol. 5, no (2) (2020).

Sarkawi, Azila Ahmad. “Akad-akad Muamalah Dalam Fiqh: Satu Analisis,” Jurnal Syariah Vol 6, (1998).

Seff, Syaugi & Hidayatullah M. Syarif. “Urgency of the Application of Sharia Guarantee in Islamic Banking in Indonesia.” Syariah: Jurnal Hukum Dan Pemikiran 20no. 2 2020. https://doi.org/10.18592/sjhp.v20i2.6838

Shesa, Laras. “Keterjaminan Kedudukan Dzaul Arham Dalam Kewarisan Islam Melalui Wasiat Wajibah.” Al-Istinbath: Jurnal Hukum Islam 3, no. 2 (2018). https://doi.org/10.29240/jhi.v3i2.615.

Stephens, Joe C. & Johnson, Jack Gray, "Life Insurance in Estate Planning", SMU Law Review vol. 15, no 4 (1960).

Takaful Malaysia, “Borang Penamaan Takful Hibah”, accessed on Jun 2, 2024. https://www.takaful-malaysia.com.my/wp-content/uploads/2023/03/Nomination_Form.pdf ,

Yakin, Ainul. & Syafi’ie, Musta’in. “Euthanasia Active in Perspective of Islamic Inheritance: An Overview of Islamic Law” Samarah 4, no.1 (2020). http://dx.doi.org/10.22373/sjhk.v4i1.6524.

Zaenurrosyid, A., Hidayatus Sholihah & Nurhidayatuloh. “The Islamic Philanthropy Model Based on Maslahah Principles for Developing Islamic Campus in Java.” Ijtihad: Jurnal Wacana Hukum Islam dan Kemanusiaan 24, no. 2 (2024). https://doi.org/10.18326/IJTIHAD.V24I2.279-304.

Zuhdi, Syaifuddin. Dimyati, Khudzaifah. Wardiono, Kelik. Shofia, Rahma & Hakim, Abdul “The Confiscation of Husbands’ Wealth as A Collateral for Post-Divorce Child Support: Perspective of Maqāsid Al-Sharī’ah.” Samarah 8, no. 2 2024. https://doi.org/10.22373/sjhk.v8i2.17326.

Zulkafli, Bibi Nur Adila & Ahmad, Md Yazid. “Kekangan dan Penyelesaian Kelewatan ‎Pengurusan Aset Pusaka Tak Alih Orang Islam di Malaysia,” Islāmiyyāt vol. 38, no 1 (2017). http://dx.doi.org/10.17576/islamiyyat-2016-3801-06

Interviews

‎Interview with Ahmad Mustafa Mat Ali, Takaful Ikhlas practitioner, November 25, 2023.

Interview with Mohamad Fadzil Mohamad, Senior Executive, Product Development Department, Amanah Raya Berhad, June 2, 2024.

Interview with Mohamad Fadzil Mohamad, Senior Executive, Product Development Department, Amanah Raya Berhad, June 2, 2024.

Interview with Muhammad Ihsan Ahmad, Senior Executive As-Salihin Trustee Berhad, June 2, 2024.‎




DOI: http://dx.doi.org/10.22373/sjhk.v9i1.26455

Refbacks

  • There are currently no refbacks.


Copyright (c) 2025 Muhamad Muizz Abdullah, Mohd Izzat Amsyar Mohd Arif, Mohd Izzat Amsyar Mohd Arif, Aiman Amalina Abd Manaf, Aiman Amalina Abd Manaf, Muhammad Farid Sabri, Muhammad Farid Sabri

Creative Commons License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Samarah: Jurnal Hukum Keluarga dan Hukum Islam has been indexed by:

Samarah: Jurnal Hukum Keluarga dan Hukum Islam
P-ISSN 2549-3132
E-ISSN 2549-3167