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Is this Insurance Scheme Halaal?

Answered as per Hanafi Fiqh by Mahmoodiyah


Dear respect Mufti sahib’s & team, Hope doing well.

In Kuwait we are having following condition for Car insurance. To renew car each year we have to pay 20 KD to non-government insurance companies. They issue insurance for car validating for one year. Without this paper we can’t get car renewal. During the year if I don’t met any accident, I will not get my money back & next year I will have to repeat the same to renew my car. Suppose I get accident & it’s other person’s fault then looking at the damage to my car other person’s insurance company will pay me money my car damage which could be any amount (100-500 or so). In most of the cases insurance companies are different. So I will get money from the company where I didn’t get insurance. Even if for both the company is same then also I pay just 20 KD as insurance but the compensation, which I get, is more then I have paid. In this case I will be getting money from the others who pay but didn’t met to accident & they will loose their money. Please advise on this.

Your brother in Islam





The one responsible for the accident is liable for the damages. Therefore, if you hand your car over to him for repairs and he sees to it that it is repaired and returned to you, and then you are allowed to use it even if the expenditure used on the damages was settled by his insurance company. The same will apply if the expenses were handed over to you by him.

You will not be held responsible for any misfortune. If the responsible party, instead of compensating you himself, makes it known to you that you should approach his insurance company and claim the compensation yourself, and the two of you share the same company, then you are allowed to claim an amount equal to the sum forwarded to the company in previous years by the two of you, provided the benefits were not utilized. If the two of you do not share the same company, then you are allowed to claim that amount which he forwarded to the company previously on condition he did not use the benefits at anytime.

In both the aforementioned instances you are not allowed to claim more than the amount given to the company.

The above finding is applicable to those companies which do not operate in harmony with the rules of Shari’ah.

And Allah Ta’ala knows best

Mufti Muhammad Ashraf

Darul Iftaa

Jameah Mahmoodiyah


24 February 2005

15 Muharram 1426

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