THE ROLE OF TAKAFUL INSURANCE IN BUSINESS CONTINUITY OF SMES OWNED BY MOSLEMS IN NIGERIA

Abstract

Takaful Insurance is growing in Nigeria due to the large Moslem population who do not buy conventional insurance for their personal and business risks are not in tandem with Shari’ah provisions. The government, in a bid to increase the insurance penetration in the country, introduced both micro-insurance and Takaful insurance in 2016. The general objective is of this study is to examine the impact of Takaful insurance among small and medium enterprises while the specific objective is to identify the impact of Takaful insurance on business continuity of Small and Medium Enterprises in Nigeria. The Ex-post facto design was used for the investigation. This design assumed the form of an experimental design where an existing case is observed for some time in order to ‘study’ or ‘evaluate’ it. The purposive sampling technique was adopted for the work. A total of 250 copies of the questionnaire were administered to respondents drawn from the four Takaful insurance companies. The findings indicate that Takaful insurance provides protection against fortuitous losses those small and medium sized business owned by Moslems who do not believe in conventional insurance and that also it has helped improve business continuity of SMEs in Nigeria. The study concluded that Takaful insurance has protected the risks from these SMEs that would not have been insured by the conventional insurance companies. These recommendations were made based on the findings from the study and conclusion above, that: the Takaful insurance companies should intensify efforts in reaching the Moslem owned SMEs especially in the Northern part of the country; there is need more awareness on the concept and associated benefits of insuring risks using Takaful insurance.