The Ruling on Car Insurance, Insurance on Goods, Workers, and Factories
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The second question of Fatwa No. ( 2233 )
Q2: What is the ruling on insurance : such as car insurance, and insurance on goods, workers, and factories. Also, insurance is sometimes by the person's choice, and sometimes he is forced into it as a condition of the seller, such as the seller stipulating that you insure the car he is selling to you on installment, and likewise the one who sends you goods from abroad, and if there is what
is permissible and what is forbidden, and is insurance considered one of the types of riba (usury or interest)?
A2: What was mentioned in the question is commercial insurance, and commercial insurance is forbidden; because it includes gharar (excessive uncertainty in a contract) and ignorance, which are not excused, and gambling, and consuming wealth unjustly, and riba (usury or interest), and all of this is prohibited by the evidence. And what the questioner mentioned about sometimes being forced into it, there is nothing in the forms of commercial insurance that forces a person to do it; rather, he enters into it by his own choice. And it is possible for him, for example, to buy a car that does not require insurance, or to buy goods delivered at the port of arrival. This is a commercial path taken by merchants who are cautious about dealing in what is forbidden.
Q2: What is the ruling on insurance : such as car insurance, and insurance on goods, workers, and factories. Also, insurance is sometimes by the person's choice, and sometimes he is forced into it as a condition of the seller, such as the seller stipulating that you insure the car he is selling to you on installment, and likewise the one who sends you goods from abroad, and if there is what
is permissible and what is forbidden, and is insurance considered one of the types of riba (usury or interest)?
A2: What was mentioned in the question is commercial insurance, and commercial insurance is forbidden; because it includes gharar (excessive uncertainty in a contract) and ignorance, which are not excused, and gambling, and consuming wealth unjustly, and riba (usury or interest), and all of this is prohibited by the evidence. And what the questioner mentioned about sometimes being forced into it, there is nothing in the forms of commercial insurance that forces a person to do it; rather, he enters into it by his own choice. And it is possible for him, for example, to buy a car that does not require insurance, or to buy goods delivered at the port of arrival. This is a commercial path taken by merchants who are cautious about dealing in what is forbidden.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.