Insurance from Shari'ah Point of View - Part 2

All types of commercial insurance entails an unbearable amount of ambiguity or gharar , because all insurance
companies and all those who offer insurance coverage prohibit absolutely insurance against any thing that is not
liable to risks. This means that liability to hazards is a pre-condition to insurance coverage. It is also prohibited to
know in advance the exact time of happening a risk nor the amount of money you will take should an incident
happens. Thus, insurance includes the three types of the unbearable gharar.

Therefore, all categories of commercial insurance represent devouring people’s properties wrongfully which is
prohibited according to the text of the Glorious Qur’an,
(O ye who believe! Eat not up your property among yourselves in vanities…) (An-Nisa’ 4: 29)

Moreover, commercial insurance with all its forms is a trickery operation to eat up people’s property illegally. One
of the accurate statistics conducted by a German expert have proven that the proportion that goes back to people
in comparison with what they pay does not exceed 2.9%.

So, insurance is a great loss for the Ummah. As for the disbelievers whose bonds of affection and mercy were
corrupted and vanished, they were forced to resort to this kind of transactions however they hate it as they hate death.

Moreover, Sheikh Faysal Mawlawi, deputy chairman of the European Council for Fatwa and Research, adds:
Commercial insurance is originally haram as agreed upon by most contemporary scholars. It is well known that
in most non-Islamic countries there are co-operative and mutual insurance companies. There is no harm from the
Shari`ah point of view to participate in these services. So, it is unlawful for a Muslim living in a country where there
is such a co-operative insurance company to make an agreement with a commercial insurance company. But, if a
co-operative insurance company is not found one may enter into a contract with a commercial insurance company
only by way of necessity. If a person is forced by law to insurance or by way of need, it is obligatory for him to be
content with the minimum proportion of insurance that covers his need or to the minimum of such transaction he’s
being forced to carry out.