Answered by Shaykh Muhammad ibn Adam al-Kawthari
I reside in the UK. Recently my car was involved in an accident which was entirely the fault of the other party. Under the terms of my insurance policy, the necessary repairs to the car were considered beyond economical repair, (i.e. the cost of the repairs would outweigh the market value of the car). Due to this, the insurance company has offered me a settlement figure which amounts to £1500 less than the price I paid for the car. Please note I had purchased the car 4 weeks prior to the accident and similar make/model/year of cars are available to buy at the price I paid for mine. Is it permissible for me to ”haggle” with the insurance company to up their settlement figure to something closer to the amount I paid for the car?
If you are claiming from your own insurance company, then it will not be allowed for you to claim more than the actual premiums you have paid, for that will constitute Riba. And if you do take the excessive amount, you will have to dispose of it by giving it away in charity.
However, if the damages are paid by the other party’s insurance company, then it will be permissible for you to receive a figure that represents the full market value of your car. If this amount is paid by the other driver himself, it would be better.
And Allah knows best