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Journal of Islamic Marketing
An investigation of the effect of customer beliefs on the intention to participate
in family Takaful schemes
Tariq Bhatti, Maizaitulaidawati Md Husin,
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Tariq Bhatti, Maizaitulaidawati Md Husin, (2019) "An investigation of the effect of customer beliefs
on the intention to participate in family Takaful schemes", Journal of Islamic Marketing, https://
doi.org/10.1108/JIMA-04-2018-0066
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An investigation of the effect of
customer beliefs on the intention
to participate in family
Takaful schemes
Tariq Bhatti
College of Business, Zayed University, Dubai, United Arab Emirates, and
Maizaitulaidawati Md Husin
Department of Management, Malaysia University of Technology,
Kuala Lumpur, Malaysia
Abstract
Purpose –The purpose of this study is to apply the theory of planned behavior (TPB) in predicting the
intention to participate in family takaful schemes (FTSs) in the United Arab Emirates (UAE). One area of
concern for takaful operators is their untapped market and lower market share compared to those of their
conventional insurance counterparts. It is possible that the investigation of direct and indirect (belief based)
measures of TPB could shed some light on these concerns and possibly offer some assistance to takaful
operators.
Design/methodology/approach –Interrelationships among attitudes, subjective norms, perceived
behavioral controls (PBCs) and intention to participate in FTSs were examined. The relationships between
behavioral beliefs on attitudes, normative beliefs on subjective norm and control beliefs on PBC were also
assessed to fully identify the structures underlying factors measuring intentions. The respondents consisted
of 175 Muslims in the UAE. Data were collected using an online survey and analyzed using SPSS.
Findings –This study found that attitudes, subjective norms and PBCs contribute to the prediction of the
intention to participate in FTSs. This study used standard multiple regressions to identify an extensive set of
specific belief composites this can be used in the prediction of direct measures of TPB and the intention to
participate in FTS.
Practical implications –The findings of this study provide useful information to takaful marketers on
how to develop marketing strategies to increase FTS participation. This study suggests that informative and
persuasive promotions can be used to improve the penetration rate of FTSs in the UAE.
Originality/value –This study provides insights into previously unaddressed FTS participation in the
UAE. Prior work on determining FTS participation has not been applied to both direct and indirect measures
of TPB to understand the phenomenon.
Keywords Theory of planned behavior (TPB), UAE, Attitude, Family takaful schemes (FTS),
Subjective norms, Perceived behavioral control
Paper type Research paper
Introduction
The Islamic finance industry is composed of four sectors: banking, sukuk (bonds), equity
and funds and takaful (insurance). The banking sector dominates the industry with
approximately 75 per cent of all Islamic financial assets under management. Takaful is an
important growing sector in the industry. The total global takaful contributions were
estimated to reach US$52.5bn in 2020, representing a double-digit growth rate (John, 2015;
Family
Takaful
schemes
Received 6 April2018
Revised 14 December2018
19 March 2019
Accepted 2 April2019
Journal of Islamic Marketing
© Emerald Publishing Limited
1759-0833
DOI 10.1108/JIMA-04-2018-0066
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1759-0833.htm
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Milliman, 2017). In 2015, the Gulf Cooperation Council (GCC) recorded that, at 32 per cent,
the United Arab Emirates (UAE) demonstrated the strongest growth in global takaful
contributions. This was driven mainly by the introduction of compulsory health insurance.
In addition to that, the penetration rate for general takaful is still increasing owing to the fact
that it is mandatory to have this type of insurance for every vehicle (Haroon, et al.,2016).
However, this is not the case for family takaful schemes (FTSs) in the UAE, specifically
where FTS has remained underdeveloped, with a penetration rate of less than 5 per cent
(Milliman, 2017;Sherif and Hussnain, 2017;Oxford Business Group, 2018;Al-Amri, 2015).
This underdevelopment can be attributed to two perspectives: from the “industry”
perspective, underdeveloped legal and regulatory support systems are the main reasons for
low takaful penetration in the country (Sherif and Hussnain, 2017) and from the “customer”
perspective, factors that contribute to a low penetration rate include low awareness, little
knowledge, adverse perceptions, negative word of mouth and budget constraints.
Based on these results, it would be beneficial to better understand behavioral beliefs
behind the intention to participate in FTSs. As it makes these behavioral beliefs
understandable, this study is useful to takaful marketers who wish to assess the factors that
specifically attract the customer intention to participate in FTSs (Husin et al., 2016).
This study was conducted in the UAE for two reasons:
(1) The FTS industry in the UAE is still in an introductory stage, despite there being
12 takaful operators in the nation.
(2) This study supports the UAE Government’s vision of enhancing the nation to
become a hub for Islamic finance.
Therefore, this study is helpful to the nation in the development of its takaful industry.
Although various research studies have been conducted in measuring the intention to
participate in FTSs, limited research has been conducted in the UAE. Also, most studies on
FTS participation have used only direct measures and none have included belief-based
measures (Husin et al., 2016). Belief-based measures are important, as they can help more
fully identify the structures underlying factors that measure intentions; these structures
include attitudes, subjective norms and perceived behavioral control (PBC) (Steadman and
Rutter, 2004).
The remainder of this paper is organized as follows: the next section presents the
literature review and development of several hypotheses, the third section describes the
research methodology, the fourth section presents data findings and analysis and the last
section contains the conclusion of the study.
Literature review
Takaful
By definition, takaful is “an agreement between persons who are exposed to risks to protect
themselves against harm arising from risk by paying contributions on the basis of a
commitment to donate”(Accounting and Auditing Organization for Islamic Responsibility,
2007). Takaful operates on the Islamic concepts of ta’awun (mutual help or cooperation) and
tabarru’(donation) (Billah, 1998; Ismail, 1997; Kwon, 1997; Maysami and Jean, 1991).
Takaful prohibits three key elements, which makes it differ from conventional insurance:
riba (usury), gharar (uncertainty) and maisir (gambling) (Gustina and Nurdianawati, 2012;
Fithriah and Hanudin, 2011). Riba technically refers to the addition of money or interest
from investment activities. Elements of riba can be found in the operation of conventional
insurance, in that it is operated based on money gained, interest earned and funds
accumulated from the investment in interest-bearing securities such as bonds, deposits and
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equities. Gharar, on the other hand, means danger, peril, jeopardy, hazard or risk (Al-Darir,
1997). Gharar exist in the uncertainty or indeterminacy involved in transactions, whereby
the quantity of the commodity on sale and purchased is neither predetermined nor known
(Wan Marhaini, 2002). In the operation of conventional insurance, gharar exists at the
inception of the contract, when neither the insured nor the insurer knows the exact outcome
of the contract (Wan Marhaini, 2002). Maisir is equivalent to gambling and literally means
something too easy or getting a profit without working for it. The main idea behind the
prohibition of maisir in Islam is that money should be earned through effort and knowledge,
not gained by mere chance. These three key elements are prohibited in Islam because they
promote economic inequality (Olson and Zoubi, 2008).
Takaful can be divided into two types: general takaful and family takaful (FTS). General
takaful provides short-term policies, most of which involve vehicular insurance, while FTSs
provide long-term policies such as life insurance, long-term savings and compensation of
dependents in the event of a participant’s death or disability (Yazid et al.,2012;Redzuan
et al.,2009).
Takaful industry in the UAE
As of 2018, out of 61 insurance companies, there are 12 takaful operators in the UAE.
Takaful written premiums in the country as a whole were worth 4.2bn dirhams in 2017,
compared to 0.7bn dirhams in 2016, with an increase of 508m dirhams or 13.5 per cent (UAE
Insurance Authority Annual Report, 2017). The total gross of written premiums among
takaful operators in 2017 was only 15 per cent of the insurance market, with the other 85 per
cent being made up of conventional insurance operators. This shows that the takaful
industry is still far behind its conventional counterparts. Conventional insurance companies
in the UAE have traditionally been more profitable than takaful operators because they are
well established (Oxford Business Group, 2018). Although the takaful industry, and
especially FTSs, underperformed compared to conventional insurance, several factors may
enhance its development and future performance; these factors include an increasing
population base, a large workforce of foreigners, an increasing life expectancy and
supportive government initiatives (Al-Amri, 2015).
Theory of planned behavior
Theory of planned behavior (TPB) was developed by Icek Ajzen to explain factors
influencing intentions and behavior (Ajzen, 1991). According to TPB, intentions can be
determined by three beliefs: behavioral belief (attitude), normative belief (subjective norms)
and control belief (PBC). Behavioral beliefs explain the presence of factors which either
facilitate or impede the performance of behavior-based actions (Sommer, 2011). Normative
beliefs are an individual’s understanding of the extent to which other people who are
important to them think they should or should not perform particular behaviors (Madden
et al.,1992). Control beliefs reflect an individual’s access to the resources and opportunities
needed to perform actions, or, alternatively, their access to the internal and external factors
that may facilitate or impede the performance of those actions.
Theoretically, attitudes are based on behavioral beliefs, subjective norms on normative
beliefs and PBC on control beliefs. However, these propositions are subject to empirical test.
The validity of the belief composite measures is typically tested by correlating each
composite with the reflective (“direct”) measure of its corresponding construct. According to
Fishbein and Ajzen (1975), behavioral beliefs, normative beliefs and control beliefs are the
formative indicators of attitudes, subjective norms and PBC,as shown in Figure 1.
Family
Takaful
schemes
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Prior application of TPB to takaful products
In an attempt to acquire in-depth understanding of the customer intention to participate
in FTSs, this paper adapts TPB to a takaful setting. One of the reasons for adapting TPB
is that it is widely used in explaining the intention-behavior of a customer. TPB has been
widely used in financial settings such as Islamic banking (Warsame and Ireri, 2016;
Abou-Youssef et al., 2015;Amin et al., 2014), insurance (Ramamoorthy et al., 2018), unit
trust (Ali et al., 2014)andtakaful (Aziz et al., 2017;Aziz et al., 2015;MdHusin and
Rahman, 2016a). In a takaful setting, Husin and Rahman (2016a) used TPB in measuring
customer intention to participate in FTSs in Malaysia. Aziz et al. (2015) also used TPB to
measure factors influencing the intention of paddy farmers to participate in agriculture
takaful.
Hypotheses development
Behavioral beliefs and attitudes
A behavioral belief is the subjective probability that a given behavior will produce a
given outcome. Each behavioral belief links a behavior to a certain outcome (the
benefit produced or cost incurred by performing the behavior) or to some other
attribute, such as positive or negative affective experiences (Ajzen and Driver, 1991).
Attitudes can be defined as psychological tendencies expressed through the evaluation
of certain behaviors (Ajzen, 2000). Attitudes, formed by internal associations and
assessment processes, play a direct role in developing positive or negative intentions
(Farah, 2014).
According to Ajzen and Fishbein (1980) and Chang (2006), the behavioral beliefs of an
attitude construct can be found by listing the characteristics, qualities and attributes of
an object under consideration. Although beliefs can be powerful, people can only attend
to a few of them at any given time. These beliefs are the immediate determinants of
attitudes and, ultimately, behavioral intentions. For instance, once people believe that
participating in FTS will lead to a positive outcome, they will develop a positive attitude
toward FTS itself.
To predict attitudes from beliefs, Ajzen and Fishbein (1980) suggest four steps. First,
understand a subject’s salient beliefs; second, measure how a subject evaluates the outcome
of each salient belief; third, measure the strength of each belief by asking them to indicate
the likelihood that performing an action will result in a given outcome; and fourth, evaluate
the outcome of each action that results from these beliefs.
Many studies have shown significant effects of attitudes toward intentions (Taylor and
Todd, 1995;Shih and Fang, 2004). In the specific context of participation in FTSs, attitudes
Figure 1.
The theory of
planned behavior
Behavioural beliefs
Control beliefs
Normative beliefs
Perceived behavioural
control
Subjective norms
Attitudes
Intentions
Indirect determinants
Direct determinants
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indicate the positive or negative degree of exhibited customer-purchasing behavior (Yadvav
et al., 2015). Similarly, the effects of attitudes on the behavioral intention to purchase or
participate in financial products and FTSs have been theorized and validated by numerous
studies, such as Husin et al. (2016);Echchabi and Olaniyi (2012);Taib et al. (2008); Amin and
Chong (2011) and Amin et al. (2014). Hence, adapting an attitude construct seems justified,
and the following hypotheses areproposed:
H1. There is a significant relationship between attitudes and the intention to participate
in FTSs.
H1a. There is a significant relationship between behavioral beliefs and attitudes.
Normative beliefs and subjective norms
Normative beliefs are concerned with the likelihood that important referent individuals or
groups would approve or disapprove of performing a given behavior (Ajzen and Driver,
1991), while subjective norms are defined as social pressures to perform or refrain from
performing a given action (Ajzen and Fishbein, 1980). Normative beliefs suggest that
behavior is instigated by the desire to act similarly to how important referents act or think
one should act (Pavlou and Fygenson, 2006). While subjective norms relate to the function of
general social pressure, underlying normative beliefs are concerned with the likelihood of
referents, with whom individuals are motivated to comply, approving or disapproving of a
given behavior. Important referents may include family, friends, word of mouth and mass
media. Previous studies conducted by Mansor (2004) and Hashim (2006) have found that
recommendations from family and friends are the main reason for FTS participation. This
significant influence of family and friends also has been seen in the study of a selection of
Islamic financial systems (Haron et al., 1994;Gerrard and Cunningham, 2001;Metawa and
Almossawi, 1998;Naser and Jamal, 1999). Other than family and friends, word of mouth and
mass media have also been considered as referents which affect the intention to participate
in FTSs. For instance, Husin et al. (2016) and Husin and Rahman (2016a) found a significant
relationship between word-of-mouth referents and mass media referents on subjective
norms. The roles of word of mouth and mass media have also been validated in different
areas, including the intention to use internet banking (Bhattacherjee, 2000;Limayem et al.,
2000;Zolait and Sulaiman (2009).
Many previous studies have indicated subjective norms are important predictors of
individual intentions (Pederson, 2005;Hanudin and Rosita, 2011;Echchabi and Olaniyi,
2012). Subjective norms have also been found to have a positive influence on the intention to
purchase financial products and services, as well as to participate in FTSs (Husin et al., 2016;
Razak and Abduh, 2012; Saad et al., 2010; Siang and Weng, 2011). Therefore, this study
hypothesizes that:
H2. There is a significant relationship between subjective norms and the intention to
participate in FTSs.
H2a. There is a significant relationship between normative beliefs and subjective
norms.
Control beliefs and perceived behavioral control
Control beliefs reflect the extent to which people think they are able to control or influence
outcomes. The more resources and opportunities people believe they possess, and the fewer
Family
Takaful
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obstacles or impediments they anticipate, the greater is their perceived control over their
behavior (Ajzen and Driver, 1991).
PBC refers to the perception of the ease or difficulty of performing a certain
behavior. In other words, an individual’sconfidence in performing a specifictask
significantly influences their intention and behavior (Ajzen, 1991). According to Ajzen
(1991), control beliefs are the antecedents of PBC. According to Madden et al. (1992),
when people are not equipped with sufficient resources or information to initiate a task,
their intention to perform the task may be lowered, even if they have favorable attitudes
or subjective norms toward it.
To illustrate PBC in the case of participation in FTSs, when people believe that they have
more resources, their perceptions of control are high and therefore their behavioral
intentions increase. Numerous studies have disclosed the positive effect of PBC on intentions
(Armitage and Christian, 2003;Leng et al.,2011;Liao et al.,1999; Zolait, 2008), including in a
financial service context (Raedah et al., 2011; Rutherford and DeVaney, 2009; Saad et al.,
2010; Yaseen et al.,2011) and family (Husin and Rahman, 2016a). The above discussion
leads to the following hypotheses:
H3. There is a significant relationship between perceived behavioral control and the
intention to participate in FTSs.
H3a. There is a significant relationship between control beliefs and perceived
behavioral control.
Methodology
Sample and procedure
A convenience sampling technique was used for this study. This method is widely used in
behavioral intention studies (Husin and Rahman, 2013b;Jin and Kang, 2011;Letchumanan
and Tarmizi, 2011; Suddin et al., 2009). Data for this study were gathered through an online
survey. An online survey was chosen owing to its flexibility and because it allowed real-time
results and was more accurate. Respondents were selected among Muslims in the UAE.
Multiple regression analysis was performed using SPSS.
All items intended to measure the constructs in this study were adapted from previously
validated instruments. The construct of attitude was measured with scales from Madden
et al. (1992), and Ajzen (2000), subjective norms were measured with scales from Ajzen and
Fishbein (1980) and Husin and Rahman (2016a), PBC was assessed with measures reported
by Buell et al. (2014) and Lee and Romaniuk (2009) and intentions were measured with scales
from Husin and Rahman (2013b).
Semi-structured interviews (Bennett and Sung, 2013) were carried out with a sample of
customers of FTSs (N= 14) to collect detailed information to better understand their
behavioral, normative and control beliefs about FTSs (Gowanit et al., 2016; Drew, 2014).
These interviews aimed to understand the beliefs behind the intention to purchase FTSs,
develop the foundations for the quantitative phase of this study and refine the research
problem (Farah, 2017; Weischedel et al., 2005). Takaful agents provided a focused sample of
customers representing gender, age and city and how long they had been participating in
FTSs with takaful operators. Interviewees consisted of ten men and four women, with ages
ranging between 30 and 50 years. Moreover, equal distribution of interviewees from each of
two cities (Abu Dhabi and Dubai) was observed.
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In line with standard procedures described by Ajzen (2000) for eliciting beliefs for
TPB studies, behavioral beliefs were elicited by asking participants the following three
questions:
Q1. What do you believe are the advantages of participating in FTS?
Q2. What do you believe are the disadvantages of participating in FTS?
Q3. Is there anything else you think is good or bad about participating in FTS?
The following three questions were used to elicit normative beliefs:
Q4. Which individuals or groups of people would approve of you participating in FTS?
Q5. Which individuals or groups of people would disapprove of you participating in
FTS?
Q6. Are there any other individuals or groups who would approve or disapprove of you
participating in FTS?
Finally, control beliefs were elicited by asking the following three questions:
Q7. What factors or circumstances would make you more likely to participate in FTS?
Q8. What factors or circumstances would make you less likely to participate in FTS?
Q9. Are there any other factors you can think of that make participating in FTS easy or
difficult?
The content of the semi-structured interview data was analyzed and used to develop indirect
measures (behavioral, normative and control beliefs) for participating in FTS as per PBC.
The validity of these themes was confirmed through the existing literature on beliefs (Farah,
2014).
Agroupoftakaful experts (two from industry and two from academia) validated the item
scales to develop tentatively reliable items and to help ensure the unidimensionality of the
constructs, which is the firststepinitempurification. Experts were provided with a
questionnaire containing short descriptions of the proposed constructs, together with a list of
items from the semi-structured interviews. These experts were selected from industry using a
convenience sample. Each expert had extensive knowledge of takaful. These experts were
askedtoassigneachitemtooneofthedefined constructs. Moore and Benbasat’s (1991)
technique was applied to determine the item placement ratios for the constructs of this study.
Most of the constructs scored above 70 per cent, which is a good indicator for the acceptance of
these constructs. The items not associated with any construct were reworded or dropped from
the questionnaire. At the end of the final round, a final set of item scales appeared that
contained a high degree of face validity. In total, 12 behavioral beliefs, 6 normative beliefs and 7
control beliefs were developed from the qualitative study (Appendix).
Satisfied with the beliefs measurement scale, the next phase of testing involved both
direct and indirect measures of FTSs in a field study. The questionnaire used for this study
was divided into two sections:
(1) The first section addressed participant demographics (including gender, age,
educational level, and city of residence), the type of general takaful they had (such
as car takaful) and how long they had been participating in FTSs.
(2) The second section comprised direct and indirect measures of FTS.
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Takaful
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An online survey was developed to gather data (Kohls et al., 2009), and Professional Online
Survey was chosen to host the questionnaire. Convenience sampling method was used for
this study, and respondents were recruited through snowball technique. An email about the
survey was sent to 350 possible respondents introducing the nature of the project, giving a
brief introduction on FTS and inviting participation in the survey through a clickable link.
In total, 175 respondents completed the online survey; however, only 135 survey results
were usable.
Measures
For behavioral beliefs, both outcomes and evaluation components were measured in the
questionnaire. Respondents were asked to rate how likely or unlikely they thought the
outcomes associated with purchasing FTS in the near future were (i.e. outcome beliefs).
The corresponding outcomes were measured by asking respondents to rate how good or bad
the various outcomes would be for them. Participants were asked to evaluate, on a seven-
point, semantic-differential scale, how likely–unlikely they thought various outcomes would
be if they participated in FTSs. Behavioral belief composites were created by multiplying
behavioral belief strengths with outcome evaluations. Behavioral beliefs were included in
the questionnaire to obtain an indirect measure of attitudes (Farah, 2014). Outcome
evaluations were then measured by asking respondents to assess, on the same scale, how
good or bad those various results would be.
Normative beliefs were measured by asking the participants to evaluate, on a strongly
disagree–strongly agree scale (Elliott et al., 2007), how much salient referents would want
them to participate in FTSs. Both referent beliefs and motivation to comply were measured
by using a seven-point scale of strongly disagree–strongly agree to rate how much they
would act on the beliefs of these referents.
Control beliefs were used to evaluate respondent perception of the existence of variables
that could potentially facilitate or deter respondent in the participation of FTS. To measure
control belief strengths, respondents were asked to rate on a seven-point not at all likely–
extremely likely scale their preference for and dependence on FTS, and how likely it was for
them to find alternative and viable substitutes for FTS at a reasonable premium.
Attitudes were measured on a seven-point semantic-differential scale that used four
interrogatory statements generated from Madden et al. (1992):
(1) “For me to participate in family takaful schemes is beneficial.”
(2) “For me to participate in family takaful schemes is pleasant.”
(3) “For me to participate in family takaful schemes is good.”
(4) “For me to participate in family takaful schemes is acceptable.”
Subjective norms were measured by four items generated from the studies of Ajzen and
Fishbein (1980) and Husin and Rahman (2014):
(1) “People who influence my decision think that I should purchase a family takaful
scheme.”
(2) “People who are important to me think that I should purchase a family takaful
scheme.”
(3) “People whose opinions I value think that I should purchase a family takaful
scheme.”
(4) “People who are close to me think that I should purchase a family takaful scheme.”
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All of the items were measured on a strongly agree –strongly disagree scale.
The scale to measure PBC comprised three items taken from Francis et al. (2004) and
modified to suit this study:
(1) “It will be difficult for me to purchase family takaful schemes in the near future”
(using I definitely do not –Idefinitely do).
(2) “I am very confident that I will be able to purchase family takaful schemes in the
near future”(using not at all confident –very confident).
(3) “I have total control over purchasing family takaful schemes.”
Four seven-point (strongly agree –strongly disagree) semantic-differential items were
adopted from Husin and Rahman (2014) to determine each respondent’s intention to
participate in FTSs. The items were “I intend to purchase a family takaful scheme in the
near future,”“I am likely to purchase a family takaful scheme in the future,”“I expect to
purchase a family takaful scheme”and “I want to purchase a family takaful scheme.”
Findings and discussion
Profile of the respondents
Out of 350 respondents, 175 completed the survey, and data from 135 were used for further
analysis. In total, 72.46 per cent were men and 27.54 per cent were women. In terms of age,
10.14 per cent of respondents were between 21 and 30 years old, 51.44 per cent were between
31 and 40 years old, 24.78 per cent were between 41 and 50 years old, 11.3 per cent were
between 51 and 60 years old and 2.34 per cent were over 60 years old. In terms of education,
16.7 per cent of the respondents had a high school certificate, 45.1 per cent had a bachelor’s
degree, 37.3 per cent had post-graduate degree and 0.9 per cent of the respondents had a
different education or diploma. As for their employment status, most respondents worked in
the private sector, accounting for 62 per cent, while 20 per cent were self-employed; the
remainder worked in the government sector.
For the behavioral beliefs construct, respondents were asked to rate how likely or unlikely
they thought near-future outcomes associated with participating in FTS were. The behavioral
beliefs construct was measured with scales developed from a semi-structured interview (Ajzen,
2000). The normative beliefs construct was measured with scales from semi-structured
interviews. The respondents were asked to evaluate the opinions of salient referents with regard
to FTS participation. Control beliefs were used to evaluate the perception respondents had in the
existence of variables that could potentially facilitate or deter their participation in FTSs.
Measurement model, reliability and validity
The reliability of both direct and indirect measures is presented in Table I. Cronbach’s alpha
of each construct is 0.7 or greater and shows an adequate reliability of the instrument for
Table I.
Alpha reliability
coefficients
Constructs Items
a
Attitude 40.89
Subjective norms 40.70
PBC 30.76
Intention 40.78
Behavioral beliefs 12 0.75
Normative beliefs 6 0.80
Control beliefs 7 0.71
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this study. Because this research is testing the existing theory, confirmatory factor analysis
was used. Factor loading for all direct and indirect measures were above 0.5, and the results
demonstrate that the items load on their related construct. These measures are presented in
Table II.
The convergent validity of the measurement was tested by assessing the factor loading,
or the average value extraction (AVE).
To check the discriminant validity, the AVE and squared correlation of constructs were
compared for each pair of constructs. As shown in Table III, this was met, as no correlation
exceeds the square root of the AVE.
The predictive power of the model is determined using the R
2
value, while the strength of
the hypothesized relationships is determined using path coefficients. The results of the
Table II.
Confirmatory factor
analysis
Constructs Item Factor loading CR AVE
Attitude (ATT) ATT1 0.875 0.895 0.70
ATT2 0.842
ATT3 0.821
ATT4 0.761
Subjective norms (SBN) SBN1 0.533 0.84 0.58
SBN2 0.897
SBN3 0.819
SBN4 0.752
PBC (PCB) PCB1 0.557 0.74 0.51
PCB2 0.615
PCB3 0.862
Intention (INT) INT1 0.593 0.88 0.68
INT2 0.958
INT3 0.822
INT4 0.86
Behavioral belief (BEB) BEB1 0.857 0.94 0.61
BEB2 0.759
BEB3 0.622
BEB4 0.678
BEB5 0.867
BEB6 0.815
BEB7 0.938
BEB8 0.903
BEB9 0.746
BEB10 0.814
BEB11 0.721
BEB12 0.590
Normative belief (NOB) NOB1 0.581 0.86 0.55
NOB2 0.743
NOB3 0.699
NOB4 0.613
NOB5 0.784
NOB6 0.730
Control belief (COB) COB1 0.540 0.85 0.53
COB2 0.870
COB3 0.753
COB4 0.641
COB5 0.595
COB6 0.779
COB7 0.551
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analysis, including significant standardized path coefficients for each relationship, as well
as t-values, are presented in Table IV. The R
2
value was 0.63, indicating that 63 per cent of
the variation in intention can be explained by the three named constructs, which are
attitudes, subjective norms and PBC. H1,H2 and H3 examined the influence of attitudes,
subjective norms and PBC, respectively, on the intention to participate in FTSs. All of the
hypotheses were statistically significant. More specifically, attitude toward intention (
b
=
0.27,
r
<0.001), subjective norms (
b
= 0.35,
r
<0.001) and PBC (
b
= 0.29,
r
<0.001) to
participate in FTSs were statistically significant. Findings show that customer intention to
purchase FTSs is positively related to attitude, subjective norms and PBC.
H1a,H2a and H3a examined the influence of behavioral beliefs, normative beliefs and
control beliefs on attitudes, subjective norms and PBC, respectively. Results revealed that all
the relationships were statistically significant (H1a:
b
= 0.22,
r
<0.001; H2a:
b
= 0.30,
r
<
0.001; H3a:
b
= 0.19,
r
<0.001, respectively). The R
2
value was 0.49, indicating that 49 per
cent of the variation in intention can be explained by the three named beliefs construct.
This study provides an understanding of the impact of beliefs on the intention of
purchasing FTSs. The results obtained in this study are similar to those of earlier studies
(Ajzen, 1991;Husin et al., 2016). Results indicate that a positive behavioral belief toward
FTS leads to a positive attitude toward the intention of participating in FTSs. Similarly,
social support from family and friends regarding their intention to purchase FTSs leads to
positive subjective norms. The results also indicate that favorable control belief leads
to positive PBC. Results of this reflect that both attitudes and subjective norm are direct
predicators of purchase intention. These results are in line with studies conducted in the
past (Ajzen, 2001). In contrast, a weak relationship was found between PBC and purchase
intention. This is inconsistent with the previous studies in the area of TPB but relevant to
Table III.
Discriminant validity
ATT SBN PCB INT BEB NOB COB
0.836
0.644 0.761
0.402 0.147 0.69
0.456 0.264 0.463 0.81
0.50 0.363 0.310 0.450 0.803
0.372 0.490 0.100 0.302 0.301 0.689
0.649 0.488 0.365 0.322 0.294 0.315 0.70
Note: Diagonal elements shown in italics represents the square root of average variance extracted while the
matrix entries represent the correlation
Table IV.
Multiple regression
analysis results
Hypothesis Relationship
Unstandardized
path estimates (
b
)* t-value Results
H1 Attitude !Intention 0.27 6.57 Supported
H2 Subjective norms !Intention 0.35 6.29 Supported
H3 PBC !Intention 0.21 5.25 Supported
H1a Behavioral beliefs !Attitude 0.22 5.08 Supported
H2a Normative beliefs !Subjective norm 0.30 5.19 Supported
H3a Control beliefs !PBC 0.19 4.59 Supported
Note: *p<0.001
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FTSs. One of the reasons why potential customers may not intend to participate could be the
lack of financial resources or of access to them. Marketers of takaful providers identify the
reasons behind this hindrance and address them to increase the customer base for this
service.
Understanding the indirect measures (beliefs) of purchasing FTSs is important, and very
few past studies have addressed this. Moreover, most of the related literature on FTSs lacks
a theoretical foundation. By understanding customer beliefs that positively and negatively
affect the intention to participate in FTS, marketers can develop strategies that increase
customer participation in FTS.
Testing the underpinning beliefs of TPB. To obtain more specific, concrete information
about each of the beliefs and the intention to participate in FTSs, this study examined the
correlations between indirect measures (beliefs), direct measures and the intention construct.
Behavioral beliefs, attitudes and intention to participate in FTSs
Including all behavioral belief composites, the model could explain 50 per cent of the
variance in attitude and 45 per cent variance in intention. The behavioral beliefs that made a
significant contribution to the prediction of attitudes include: “BEB7 –It will help to fulfill
religious obligations”(
b
= 0.35, N=135,p<0.05); “BEB8 –It will help in avoiding
involvement with interest, gambling, and uncertainty”(
b
= 0.18, N= 135, p<0.05); and
“BEB3 –It will promote a sense of community by assisting Muslim families”(
b
= 0.40, N=
130, p<0.05). Whereas, the behavioral beliefs that made a significant contribution to the
prediction of intentions include “BEB4 –It will provide security to dependents in the case of
demise”(
b
= 0.39, N= 134, p<0.001); “BEB5 –It will provide returns on the investment in
Shariah-compliant instruments”(
b
= 0.35, N=135,p<0.05); and “BEB10 –It will be
impossible due to a lack of exposure of FTS”(
b
= 0.38, N=135,p<0.05). According to
Ajzen (2006), changes in behavioral beliefs should result in corresponding changes in their
intentions as well as their actual behavior. The marketers of FTS providers should provide
more information about FTSs. Communication strategies should be revised or improved
using intervention methods based on TPB that would change FTS-purchasing intention.
Normative beliefs, subjective norms and intention to participate in FTSs
Investigation of the relationships between normative beliefs and subjective norms and
intentions found that 49 per cent and 30 per cent variances exist on the relationships
between normative beliefs on subjective norms and intentions, respectively. Two normative
beliefs, “NOB2 –immediate family and other relatives”and “NOB3 –friends and
colleagues,”contributed to the prediction of subjective norms and intentions. In detail, the
normative beliefs “NOB2 –Immediate family and other relatives”(
b
= 0.47, N= 130, p<
0.001) and “NOB3 –friends and colleagues”(
b
= 0.53, N=130,p<0.001) had a significant
b
value and contributed to theprediction of subjective norms. Thesame is true for the effect
of normative beliefs on intentions (
b
= 0.49, N= 130, p<0.001,
b
= 0.56, N=130,p<
0.001).
As a general rule, there is, of course, no reason to expect that increased motivation to
comply will produce an increase in the intention to do so. The effect of motivation to comply
should depend on the perceived normative expectations. Only when respondents uniformly
believe that a given referent thinks they should perform the behavior, would motivation to
comply be expected to show a positive correlation with a frequency of performance. In this
study, when respondents believe that a referent would approve of the behavior (where
referents include immediate and distant family, friends, and colleagues), one expects a
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positive correlation between their motivation to comply and their intention to participate in
FTS.
Control beliefs, perceived behavioral control and intention to participate in FTSs
Control beliefs are found to have the most facilitating or hindering factors of PBC and the
intention to participate in FTS. Investigation of the relationships between control beliefs on
PBC and intentions found that 36.5 per cent and 32.2 per cent variances exist in the
relationships between control beliefs on PBC and intentions, respectively. The control beliefs
“COB1 –has insufficient monthly income”(
b
= 0.40, N= 130, p<0.01), “COB3 –has
sufficient savings”(
b
= 0.25, N=135,p<0.05), “COB6 –Is uncertain of employment”(
b
=
0.21, N=130,p<0.05) and “COB7 –has alternative coverage policies”(
b
= 0.19, N=130)
made significant contributions to the prediction of PBC. On the other hand, only control
beliefs “COB4 –has preferences for Shariah-compliant insurance”(
b
= 0.20, N=134,p<
0.01) and “COB3 –has sufficient savings”(
b
= 0.24, N= 135, p<0.05) made significant
contributions to the prediction of intentions.
In brief, participation in FTSs is influenced by several perceived possessions such as
sufficient monthly income, adequate savings and stable employment. The more that
insufficient income, inadequate saving and unstable employment were considered to
interfere with participation in FTS, the greater was the influence of the control beliefs.
Conclusion
The purpose of this study is to apply TPB to predict the intention of UAE customers to
participate in FTSs. Interrelationships among attitudes, subjective norms, PBC and the
intention to participate in FTS were examined. The relationships between behavioral beliefs
on attitudes, normative beliefs on subjective norms and control beliefs on PBC were also
assessed to fully identify the structures underlying factors that measure intention. An online
survey was conducted and collected from 175 Muslims in the UAE. Data were analyzed
using SPSS.
The results show that direct measures of attitudes, subjective norms and PBC have a
larger contribution to TPB than do indirect measures. Although the contents of indirect
beliefs were behavior-specific, their classification into behavioral, normative and control
categories proved useful for understanding the intention to participate in FTS, as examined
in this study.
Fishbein and Ajzen (1975) have argued that changing underlying beliefs should lead to
corresponding changes in attitudes, subjective norms, PBC and intentions (Ajzen and
Fishbein, 1980). Within the context of customer intention to participate in FTSs, this
approach seems plausible. Previous research has demonstrated that TPB can predict
customer intention to participate in FTSs (Husin and Rahman, 2016b). The present study
identified specific beliefs that made important contributions toward customer attitudes,
subjective norms, perceived control and intentions. These beliefs can be used to help design
media campaigns to persuade customers to participate in FTSs rather than conventional life
insurance. Changing customer beliefs about FTSs through intervention, by using
persuasive messages and increased exposure, will bring positive results to customer
participation in these schemes.
Participation in FTSs is influenced by behavioral beliefs about fulfilling religious
obligations, avoiding involvement with prohibited elements in Islamic law and helping
unfortunate participants; other influences include the normative expectations of important
others, and the required resources and other factors that facilitate or impede the
performance of intention.
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Understanding why customers choose not to participate in FTS is an important issue for
marketers and researchers. As such, the findings of this study have significant implications
for marketers and researchers. To convert potential customers to actual buyers, takaful
marketers have to develop positive attitudes toward FTS using promotional activities,
which will have an effect on attitudes and influence intentions. In this study, a weak
relationship between PBC and intentions was also found. With this information, marketers
could reduce barriers tocustomer participation in FTSs.
This study is significant for both practitioners and researchers trying to determine the
motivating and inhibitory factors of purchasing FTS. By understanding related direct and
indirect beliefs, a proper strategy can be devised to promote identified motivating beliefs
(Trafimow and Finlay, 2002). This study also enhances the applicability of direct and
indirect belief measures of TPB, something which has rarely been applied to research in an
overall financial-service setting, or to takaful specifically.
This study offers several theoretical contributions. Its first is the original application of
TPB in the study of participating intentions in the context of FTSs. It builds upon existing
literature on TPB and demonstrates three classical TPB components and their antecedent
indirect measures. Although TPB revealed itself to be a valid framework for the study of
intentions and behavior in general, its study empirically examined the impact of indirect
measures on direct measures and on the intention of participating in FTSs. While TPB has
been applied to explain customer intentions, few studies have studied the impact of indirect
and direct measures on the intention to participate in FTSs.
Future applications of TPB and its applicability to FTSs research should enable
additional studies to conclude with a generalizable pattern of results. Such
applications would enhance FTSs penetration rates in different nations. Because of the
wide array of perceived consequences that have been documented in the literature, this
theory should be tested by using different approaches to the definition of indirect
beliefs about FTSs.
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Teknologi, Vol. 63 No. 1,pp. 1-6.
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parametric approach”,Journal of Islamic Accounting and Business Research,Vol.7No.1,pp.42-58.
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pp. 530-544.
Appendix
The below-stated behavioral, normative and control beliefs relevant to participation in family takaful
schemes were obtained from the semi-structured interviews of qualitative study:
(1) Behavioral beliefs:
BEB1: Helps me to save money over a fixed period of time;
BEB2: Allows me reliable investments;
BEB3: Promotes a sense of community by assisting Muslim families;
BEB4: Provides security to dependents in the case of demise;
BEB5: Provides returns on the investment in Shariah-compliant instruments;
BEB6: Provides takaful protection for unfortunate events;
BEB7: Helps me to fulfill religious obligations;
BEB8: Helps in avoiding involvement with interest, gambling and uncertainty;
BEB9: Will be impossible, due to unsatisfactory customer service from FTS operators;
BEB10: Will be impossible due to a lack of exposure to FTS;
BEB11: Provides me minimal returns; and
BEB12: There is no difference between FTS and conventional life insurance.
(2) Normative beliefs:
NOB1: Social media (Twitter, YouTube, Snapchat);
NOB2: Immediate family and other relatives;
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NOB3: Friends and colleagues;
NOB4: Community religious leaders;
NOB5: Islamic banks; and
NOB6: Mass media (newspapers, articles, magazines, advertising).
(3) Control beliefs:
COB1: Has insufficient monthly income;
COB2: Is skeptical that FTS is truly Shariah-compliant;
COB3: Has sufficient savings;
COB4: Has a preference for Shariah-compliant insurance;
COB5: Believes the premiums (contributions) are too expensive;
COB6: Is uncertain of employment; and
COB7: Has alternative coverage policies.
Corresponding author
Tariq Bhatti can be contacted at: Tariq.Bhatti@zu.ac.ae
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Family
Takaful
schemes
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