hibah takaful
Money Management

4 Scenarios Where Hibah Takaful is Useful, As Explained by a Non-Agent

Heard about Hibah Takaful and how useful it is for yourself and your family, but not sure what it is and where to get it? You’ve come to the right place.

No guilt-tripping or sad stories about husbands not doing hibah for their wife and children here, I promise. I’m not an agent, I have nothing to sell. You do or don’t do, up to you.

Let’s start 🙂

Part 1: Hibah Takaful Meaning

Hibah Takaful is the combination of two words: Hibah meaning gift and Takaful meaning the co-operative system of reimbursement or repayment in case of loss, as per Islamic or Syariah guidelines.

It’s not quite the same, but the closest equivalent of Hibah Takaful to conventional insurance is probably Life Insurance. I’ve seen some people refer to it as Takaful Life Insurance or Life Takaful, which is technically not accurate as far as terms go, but if it makes it easy to understand then why not.

(To be honest, I’m actually quite sceptical of Islamic finance products in general. Just because it got the ‘halal stamp’ from Muslims, doesn’t mean it’s the best co-operative system. But I feel obligated to pick the halal option if it is available, so)

(Yes, I do (critically) follow Safdar Alam, the ex-investment banker who is on a mission to remove basically-riba-in-practice within Islamic banking)

Part 2: 4 Scenarios where Hibah Takaful is Useful

Rather than telling you what is included in a Hibah Takaful plan, I’m going to tell you in what situation the product is handy to have. The way I see it, Hibah Takaful is useful for four main scenarios:

Scenario 1 – Total and Permament Disability

You get total and permanent disability. Let’s say you got into an accident and your spine broken. Obviously, you can’t work anymore. It’s handy to have some money then, wouldn’t you agree?

Scenario 2 – Generational Wealth

You want to leave behind generational wealth but don’t necessarily have a lot of money/assets. Imagine with RM50 or so a month, you can leave behind hundreds of thousands of dollars?? If you do it right, the cost of your children’s education will be secured.

(This is just my opinion, but I don’t really care about the spouse. He or she is an adult, they can find work and survive somehow. But the children… they deserve all the opportunities you can give them.)

Scenario 3 – Make significant donation

You want to make a significant donation or gift to your favourite charity, cause or person(s) upon your passing. Same as Scenario 2, a small monthly sum can result in six-figure disbursements.

Scenario 4 Estate planning

You want an estate planning tool that can bypass faraid. If you ask me what is Hibah Takaful’s main advantage, then it has to be this: the gift money will be given directly to the person you want to give to without going through the Islamic Inheritance law system (and lengthy estate planning processes).

For example,

  • If you have irresponsible male family members and want to ensure female relatives will be taken cared of
  • If you’re a Muslim convert but still want to leave behind money to non-convert family members
  • If you have adopted children, who under faraid is NOT eligible to receive inheritance

Then DEFINITELY consider this financial tool. (Related: Wasiat, Hibah, Trust: 3 Tools to Circumvent Faraid / Islamic Inheritance Laws in Malaysia)

Extra ‘bonus’

This depends on the provider, but some Takaful companies in Malaysia offers Hibah Takaful products which include ‘bonuses’ like Badal Hajj – funds allocated to hire someone to do hajj on your behalf, after your passing. I thought that was a nice touch.

So far, everything sounds great right? It sounds like a miracle product, it covers everything! Wait wait. You should also learn what it is NOT.

Part 3: What is Hibah Takaful, and What it is Not:

#1 – Hibah Takaful is NOT the same with Hibah Harta

There are a few types of Hibah. For the purposes of this article, let’s clarify the difference between Hibah Takaful and Hibah Harta:

  • Hibah Takaful = the gift money is disbursed only upon death or total & permanent disability (the terms vary; check with providers)
  • Hibah Harta = gifting assets you already own, such as property, car, money in bank accounts, etc.

#2 – Hibah Takaful is also NOT a Takaful Medical Card

If Hibah Takaful is the Syariah-compliant version of Life Insurance; then Takaful Medical Card is the Syariah-compliant version of (conventional) Medical Card. They may function the same way, but they are technically different products.

Btw, you should totally get Takaful Medical Card too in addition to Hibah Takaful if you can afford it. It is useful to cover hospitalisation costs. The Takaful Provider might allow it as a separate or add-on to your plan.

Related read: 9 Things You MUST Know Before Buying Insurance in Malaysia

Part 4: How to Get Hibah Takaful

As far as I’m aware, you can only get Hibah Takaful through a Takaful Agent.

You can go to any social media and type in ‘Hibah Takaful’ or ‘#hibahtakaful’ and you’ll be sure to find Takaful agents from various Takaful companies, including but not limited to the following:

  • Etiqa Takaful
  • Zurich Takaful
  • FWD Takaful
  • Zurich Takaful
  • Prudential BSN Takaful
  • Great Eastern Takaful
  • AIA Takaful
  • and more

The cost of Hibah Takaful is ‘from RM50’. If you’re a Takaful Agent offering this service, feel free to leave your contact details in the comments section so people can find you 🙂

Next, all you have to do is contact the agent(s) and schedule a meeting to know more. The best practice is to contact at least 3 people from different Takaful companies and compare their plans and services. My top tip is to ask about exclusions and see which ones you can live with (there will be exclusions).

Protip: You will probably want the best for your family, so your Takaful Agent will probably suggest additional product upgrades. If you want, you can add-on Takaful Medical Card and/or other products, including investment-linked products. This will cost more – expect RM150-300++ per person, depending on the plan. If you can’t afford it, then just stick to Hibah Takaful for now

And there you have it. You can also check out other types of insurance and hibah and takaful options listed on my Best Insurance in Malaysia for B40 and M40 page. If you know of other options to get Hibah Takaful, especially Takaful online options, please share the info in the comments section so the rest of us can learn!

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9 Comments

  1. Thank you Suraya for this post! Hope this post can help the Malaysian especially your readers to get more knowledge and understanding about what is hibah takaful.

    Im Adib Khalid, a full time agent from PruBSN Takaful. If anyone of your readers looking for a plan to create hibah takaful plan, dont hesitate to whatsapp me 0127624974.

  2. Good post Suraya! There’s a lot of financial tools for Malaysians to manage their finances and hibah takaful is one of them.

    My name is Aizat Syamil, a takaful consultant with PruBSN Takaful. If any of the readers would like create or understand more about hibah takaful, don’t hesitate to reach out to me here: https://beacons.ai/aizatsyamil or call / WhatsApp / message me directly at +6018-7706700 😁

  3. Hi Suraya
    I love the content on this article. Its good that we can remind people on to have safety net.
    I’m Aqilah Halim, a Takaful agent from AIA, would looking forward to assist any client on surveying plan that suits them best.
    Aqilah @ 0194554158

    Get the right plan for you, dont be under or over insured.

  4. Thank you Ms Suraya for this amazing article. I really love how easy to read your article. Btw im an agent from AIA Public Takaful so you guys looking for any takaful product from AIA can contact me @ 017-2826323 (Hannie)

  5. Thank you so much for the sharing on Hibah Takaful Suraya!

    Hi all,

    My name Taufeq and work as AIA Life Planner. Any questions or interest on AIA takaful can directly contact me at 0147296712

    Thank you!

  6. Hi Suraya,
    Great, easy to understand explanation from a lay person on Hibah Takaful. Sometimes it takes one to understand one.

    As an agent, sometimes we overestimate the public’s awareness and understanding of our products. Thanks again for the breakdown.

    I am Syaz Hamzah from AIA Public Takaful. Contact me on 013 2655199 for more info.

    1. Hello Suraya!
      Thank you so much for writing this article. People should be more aware on the importance of Hibah takaful, especially when they have small children with a single source of income.
      Anyway, I’m Iylia Zuleikha bt Iskandar. One of AIA takaful life planner. If you need further info on Hibah. Do contact me at 0133671419. I will gladly assist you. Thank you! (:

  7. Hi Suraya,

    Thanks for the article. I love your content and I’m one of the Takaful Agents from Great Eastern Takaful.

    I help people in managing financial risk through Takaful using 4 elements:

    Hibah Takaful (Death/TPD)
    Critical illness instant cash
    Personal accident
    Medical Card

    I can be contacted through WhatsApp 013-2990572, Facebook: Syafiqah Mohd Sakri
    Twitter: PikaSakri

    Thank you. 😊

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