Someone insured a cellphone with an Insurance company. A while later, thecellphone was reported damaged and the insurance company paid out theperson. The insurance company later on found that the cellphone (aftertesting) was in proper working order. Hence, the company, thereafter, put itup for sale. Is it permissible for me to purchase the cellphone?
The original transaction was insurance, which is not in accordance with Shari’ah. However, when at the time of compensating the insured person the insurance company paid the price of the cellular phone and took its delivery from him it should be taken as a sale having taken place between the insurance company and the insured person. By virtue of this the insurance company acquires the ownership of the cellular phone. Therefore, purchasing of the cellphone from the company is permissible. (Justice Mufti Taqi Usmani, Pakistan) From Al Mahmood 10