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Can I take life insurance if I don’t have an option?

Answered as per Hanafi Fiqh by Askimam.org

I lecture at a university. The institution gives us life insurance from which we cannot opt out. It is a compulsory part of the package. However, we can choose what option we want to be on. There are a range of options, which start from:

Heirs will be paid out 1X my annual salary

to

4 x annual salary plus if employees spouse dies then employee will be paid 2x annual salary.

There are variuos options in between. Depending on what one chooses, ones salary is deducted accordingly. Thus for the first option one will pay less than the top of the range of options if it is chosen.

My question:

Is it halaal to choose what ever option I want?

OR

Do i choose the option with the lowest payout. ie.lowest option.

Also, is this payout halaal in the event of my demise, or that of my spouse and i am paid out.

Please let me know urgently,

Answer

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

All forms of conventional insurance and medical aid schemes are not permissible as they have three prohibited elements in them: interest, gambling and uncertainty. You may refer to the link attached below which is a transcript of Hazrat Mufti Ebrahim Desais talk for more details. [1]

If one is required by law to take out a haram conventional insurance scheme, one will be excused. Therefore, it will be permissible for to take the life insurance that your institution gives you as it is compulsory. However, you should opt for the cheapest option available. It will not be permissible for you to take the more expensive packages. Make Tawbah and Istighfaar and ask Allah to save you from the evil consequences of the haram. [2]

You have mentioned that a part of your salary is deducted for the compulsory insurance scheme. The amount deducted from your salary will be regarded as inheritance and distributed among your heirs as per the laws of inheritance. The amount contributed by the insurance company will be regarded as a gift to whoever has been named the beneficiary of the gift. That amount will not be part of the estate. [3]

And Allah Ta’āla Knows Best

Ismail Dawoodjee

Student Darul Iftaa
Zambia

Checked and Approved by,
Mufti Ebrahim Desai.

www.daruliftaa.net 

http://askimam.org/public/question_detail/16743  [1]

[2] فتاوى محمودية، ج16 ص390،ادارة الفاروق كراشي

اسلام اور جديد معاشی مسائل ج3 ص317 ادارۃ اسلاميات 

عصر حاضر کے پيچيدا مسائل ج2 ص180 الطاف ايند سنز

فتاوی دار العلوم زکريا ج5 ص443 زمزم 

Contemporary fatawa pg252 idara-e-ishaat [3]

فتاوی دار العلوم زکريا ج5 ص444 زمزم

امداد الفتاوی ج3 ص149 دار العلوم کراتشی

This answer was collected from Askimam.org, which is operated under the supervision of Mufti Ebrahim Desai from South Africa.

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