Answered by Shaykh Muhammad ibn Adam al-Kawthari
I was wondering about the permissibility of working in an insurance company, and in what circumstances would it be overlooked. I’m asking in this way because I once worked at such a place, scanning in cheques and things into the computer (just IT work, and bit of organising papers etc) and earned some money. If I am allowed, I will not earn this money again to give to the poor (which is what I was going to do – hope it’s right). It would just be a lifting of a burden on me. And I would then go about settling other issues like paying back one or two people. But if the way to purity is giving away that money, then please let me know, and pray for me and all the other people who are in these problems.
In the name of Allah, Most Compassionate, Most Merciful,
Sayyiduna Abd Allah ibn Mas’ud (Allah be pleased with him) narrates that the Messenger of Allah (Allah bless him & give him peace) has cursed the one who accepted usury, the one who paid it, the witness to it, and the one who recorded it. (Sunan Abu Dawud: Book 22, Number 3327).
In light of the above and many other narrations, scholars have ruled that it would be unlawful for a Muslim to accept employment in a bank or any such institution whose dealings are primarily centred on interest-based transactions, such as an insurance company. Therefore, employment in an insurance company would be unlawful.
If you are unemployed and have to support your dependants, you will be excused until you find an adequate alternative. Many scholars have permitted to continue working and using the income for the needs of oneself and ones family until a suitable job is found. At the same time one must seek forgiveness from Allah for one’s actions and pray to Him to extract him from this sin.
And Allah knows best
Muhammad ibn Adam al-Kawthari
Darul Iftaa, Leicester, UK