Application of Hibah principle: A study of takaful industry in Kelantan

Hibah is known for providing money to recipients while the donor is still living, but hibah for family takaful products only sends funds to the nominee when the participants die. It contradicts the spirit of hibah. Hibah is viewed as an alternative to traditional estate planning among Muslim participants who want to distribute their wealth according to their wishes. A fully executed hibah contract that meets all terms and conditions demonstrates the transfer of benefits from donor to recipient (Noor et al. 2008). The validity of the takaful benefits conferred, whether they are regarded as participants' property, and whether the grant is halted upon the grantor's passing, in which case it ceases to be a grant. The study investigates the application of the hibah principle in the takaful industry in Kelantan. This research study utilizes an interview-based questionnaire with four (4) informants using qualitative methods including descriptive study. The interview results produce the data collected and then the data is analyzed by the content analysis using ATLAS.ti software. According to the findings, it revealed that most reported hibah cases were very minimal which proves that most Muslims did not realize its existence and importance although it can be the best alternative for them to manage the distribution of their assets rather than an option for wasiyyah and faraid. The implications of this study are that it can raise awareness among Kelantan citizens, elevate hibah’s wisdom in society, and make takaful agents aware of hibah. The findings may contribute to the ease of application of the hibah principle in the takaful industry.