PERCEIVED VALUES, AWARENESS AND ACCEPTANCE OF ISLAMIC INSURANCE IN TATARSTAN BY ANSAR VALIULLIN A research paper submitted in fulfilment of the requirement for the degree of Master of Science (Islamic Banking and Finance) IIUM Institute of Islamic Banking and Finance International Islamic University Malaysia AUGUST 2017
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PERCEIVED VALUES, AWARENESS AND
ACCEPTANCE OF ISLAMIC INSURANCE IN
TATARSTAN
BY
ANSAR VALIULLIN
A research paper submitted in fulfilment of the requirement
for the degree of Master of Science (Islamic Banking and
Finance)
IIUM Institute of Islamic Banking and Finance
International Islamic University Malaysia
AUGUST 2017
ii
ABSTRACT
Over the last decades, various aspects of Islamic banking and finance, especially
Takaful has tremendous attention from various stakeholders in Tatarstan including the
government, scholars and public opinion experts. This is in line with the aim of the
Russian Federation towards making Tatarstan Republic the hub of Islamic banking
and finance in its region. This research thus examines the level of awareness,
perceived values and acceptance of the public towards Islamic insurance in Tatarstan.
The study implemented Theory of Reasoned Action (TRA) to analyse the factors
affecting Tatarstan citizens’ intention to patronize Islamic insurance in Tatarstan.
Relevant primary data were elicited from 210 respondents via a survey questionnaire.
The data obtained was subjected to both descriptive and inferential statistical analysis
using “Statistical Package for Social Sciences” (SPSS) and “Analysis of Moment
Structure” (AMoS) computer software respectively. Specifically, AMoS was
employed to perform Confirmatory Factor Analysis (CFA) and Structural Equation
Modelling (SEM). The findings of the study indicated that the Tatarstan public has
general awareness about Islamic insurance and is willing to patronize it. Subjective
Norms and Perceived values were both found to significantly influence intention to
patronise Takaful services in Tatarstan.
iii
خلاصة البحثAbstract in Arabic
خلال العقود القليلة الماضية، لفتت قطاعات متنوعة من المصرفية والمالية الإسلامية انتباه العديد من أصحاب الشأن في جمهورية تتارستان على أهميتها من ضمنهم الحكومة والعلماء وخبراء الشأن العام. يتماشى ذلك مع هدف الحكومة
وجهة الرئيسة للمصرفية والمالية الإسلامية في المنطقة. هذا البحث يدرس الروسية الفدرالية في جعل جمهورية تتارستان الدركة، والتقبل لدى الجمهور التتارستاني. هذا البحث يطبق نظرية الفعل المعقول مستوى الوعي،
(TRA)والقيم الم
الإسلامي االتعاوني.. توصل لتحليل العوامل المؤثرة في نية مواطني تتارستان المقيمين فيها لتعاملهم مع شركات التأمينستجوبين. حل لت 012الباحث على البيانات الأولية من خلال استبانات استطلاع الرأي التي وزعها على
من الم
على AMoSو SPSSالبيانات اعتمادا على منهجي التحليل الوصفي والتحليل الاستدلالي باستخدام برنامجي وكذلك نمذجة (CFA)للحصول على تحليل العامل التوكيدي AMoSبرنامج التوالي. بشكل أدق، استخدم
. تشير نتائج البحث إلى أن الجمهور التتارستاني لديه وعي عام عن التأمين الإسلامي (SEM)المعادلة الهيكلية عايير غير الموضوعية االتعاوني. ومستعد للتعامل مع من يقدم منتجاته. وخلصت النتائج كذلك إلى أن القيم المدركة والم
هي أشد العوامل تأثيرا على مدى تقبل الجمهور التتارستاني وتعامله مع منتجات التأمين الإسلامي االتعاوني..
iv
APPROVAL PAGE
I certify that I have supervised and read this study and that in my opinion, it conforms
to acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a research paper for the degree of Master of Science (Islamic Banking and
Finance).
…………………………………..
Adewale Abideen Adeyemi
Supervisor
This research paper was submitted to the IIUM Institute of Islamic Banking and
Finance and is accepted as a fulfilment of the requirement for the degree Master of
Science (Islamic Banking and Finance).
…………………………………..
Syed Musa Alhabashi
Dean, IIUM Institute of Islamic
Banking and Finance
v
DECLARATION
I hereby declare that this research paper is the result of my own investigation, except
where otherwise stated. I also declare that it has not been previously or concurrently
submitted as a whole for any other degrees at IIUM or other institutions.
Ansar Valiullin
Signature…………………....………. Date …….……………….
vi
COPYRIGHT PAGE
INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA
DECLARATION OF COPYRIGHT AND AFFIRMATION OF
FAIR USE OF UNPUBLISHED RESEARCH
PERCEIVED VALUES, AWARENESS AND ACCEPTANCE OF
ISLAMIC INSURANCE IN TATARSTAN
I declare that the copyright holders of this research paper are jointly owned by the
No part of this unpublished research may be reproduced, stored in a retrieval system,
or transmitted, in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise without prior written permission of the copyright holder
except as provided below
1. Any material contained in or derived from this unpublished research may
be used by others in their writing with due acknowledgement.
2. IIUM or its library will have the right to make and transmit copies (print
or electronic) for institutional and academic purposes.
3. The IIUM library will have the right to make, store in a retrieved system
and supply copies of this unpublished research if requested by other
universities and research libraries.
By signing this form, I acknowledged that I have read and understand the IIUM
Intellectual Property Right and Commercialization policy.
Affirmed by Ansar Valiullin
……..…………………….. ………………………..
Signature Date
vii
DEDICATION
This research is dedicated to my parents
Kamil Valiullin and Nuraniya Valiullina
viii
ACKNOWLEDGEMENTS
All praises belong to Almighty Allah, The Most Gracious, The Most Merciful, the
lord of the world. I am thankful to Allah (S.W.T) who has favored me of pursuing a
Master’s degree, and for granting me the blessings, strength, persistence and the
endurance to complete my studies successfully.
I would like to express my deepest gratitude to my family. I thank them for
their love, care and unwavering support throughout my entire life. I also thank them
for giving me opportunity to obtain knowledge and for being an ultimate source of
motivation while pursuing my studies.
I certainly would like to convey my gratitude to my supervisor, Assoc. Prof.
Dr. Adewale Abideen, for his guidance, patience and valuable comments and advice
throughout the duration of this research.
Among others are the respondents of my survey and all those who have helped
me during my data collection. This appreciations would not be completed without
expressing my profound gratitude to the IIiBF lecturers and students for their
guidance, assistance and support. May Allah (S.W.T) bless you all in this world and
hereafter. Ameen.
ix
TABLE OF CONTENTS
Abstract ........................................................................................................................ ii Abstract in Arabic ........................................................................................................ iii Approval Page .............................................................................................................. iv
Declaration ................................................................................................................... v Copyright Page ............................................................................................................. vi Dedication .................................................................................................................... vii Acknowledgements ...................................................................................................... viii
List of Tables ............................................................................................................... xi List of Figures .............................................................................................................. xii
1.1 Background of Study .................................................................................. 1 1.2 Problem Statement ...................................................................................... 3 1.3 Objectives of the Research ......................................................................... 4 1.4 Research Questions ..................................................................................... 5
1.5 Significance of the Study ............................................................................ 5 1.6 Scope of the Study ...................................................................................... 6
1.7 Plan of the Study ......................................................................................... 6
CHAPTER TWO: LITERATURE REVIEW ......................................................... 8 2.1 Introduction................................................................................................. 8
2.2 Background of the Country ........................................................................ 8 2.3 Insurance Market in Russia ........................................................................ 9 2.4 Islamic Insurance ........................................................................................ 10
2.4.1 Definition and Concept of Islamic Insurance ................................... 10 2.4.2 Shari’ah Compliance ......................................................................... 11
2.4.3 Differences Between Islamic and Conventional Insurance .............. 12 2.5 Global Consumer Awareness about Takaful .............................................. 13
2.6 A Theoretical Framework of the Research ................................................. 15 2.7 Modified Model .......................................................................................... 19 2.8 Variables Specification ............................................................................... 20
2.9 Research Hypotheses .................................................................................. 22 2.10 Chapter Summary ..................................................................................... 23
CHAPTER THREE: RESEARCH METHODOLOGY ........................................ 24 3.1 Introduction................................................................................................. 24 3.2 Research Design ......................................................................................... 24 3.3 Population ................................................................................................... 25
3.4 Sample Procedure ....................................................................................... 25 3.5 Types and Source of Data ........................................................................... 26
3.5.2 Distribution ....................................................................................... 27 3.5.3 Questionnaire Language ................................................................... 27
x
3.6 Statistical Tool and Procedures of Data Analysis....................................... 28 3.6.1 Descriptive Statistics ......................................................................... 29 3.6.2 Structural Equation Modelling .......................................................... 30
4.5.1 Assessment of Validity in the Confirmatory Factor Analysis .......... 50
4.6 Structural Model ......................................................................................... 52 4.7 Chapter Summary ....................................................................................... 54
CHAPTER FIVE: CONCLUSION, RECOMMENDATION,
LIMITATION AND SUGGESTED AREAS OF FUTURE RESEARCH ........... 56 5.1 Introduction................................................................................................. 56 5.2 Summary of the Research ........................................................................... 56
5.3 Discussion of Major Findings ..................................................................... 58
5.4 Contribution of the Study ........................................................................... 60 5.4.1 Contribution to the Industry .............................................................. 60 5.4.2 Contribution to Body of Knowledge ................................................. 60 5.4.3 Contribution to Policy Makers .......................................................... 61
5.5 Limitation ................................................................................................... 61 5.6 Recommendation ........................................................................................ 62 5.7 Summary of the Chapter ............................................................................. 63