Everyone is getting Car Insurance policies but being a Muslim our first concern is whether Car Insurance is Haram or Halal? Is Cheese Halal or Haram? The interest restriction has led to a number of financial instruments that allow for a halal investment. The debate is concluding. Wiki User Answered . Muhammed-Shahid Ebrahim These are only some of the violations of sharee’ah which insurance is essentially based upon. Car Insurance is very common in today’s world. Or that buying a washer and dryer made by General Electric is forbidden since GE operates a huge lending business. However, what a lot of people don't consider in all these factors is that when it comes to halal and haraam, it's not really as black and white as it seems. All forms of commercial insurance are based on uncertainty of the most extreme kind. The largest place to learn and discuss about the teachings of Islam, the Holy Prophet Muhammad, the Salat, Quran, Ramadan, Hajj and various Islamic lifestyle issues. Relating to this, fuqaha allow takaful insurance – which is a form of cooperative insurance along these lines. The choice is ours. It does not just apply to food but to all aspects of everyday life. 15.7k Followers, 1,756 Following, 2,294 Posts - See Instagram photos and videos from Halal Or Haram (@isithalalorharam) An insurance contract involves the exchange of two things: money and risk. Podcast Episode 1: Analyzing Murabaha, Halal or Haram? On top of that as a Muslim having a will is super important so that your inheritance is separated up the Islamic way. Earning money due to price appreciation of the underlying asset, or from profit distribution of different businesses does not constitute a violation, and so, since Islam is based on permissibility, investing in stocks is halal. The basic premise I want you all to keep in mind is that Islam and the fuqaha do allow us to mitigate risk by pooling our wealth and paying out to those who lose out from an uncertain loss. But present day insurance is not to profit rather covers a loss to a level as it was or would be- like if a building valuation is 100 and fire damages it then max claim will not exceed the Market value, ‘thus no profit. The payments you make to an insurance company, with which you are purchasing protection for yourself, are partially going to the insurance company as profit and the other part is going to cover the financial burden of some other insured person who has had a difficult event befall them. Halal and haram are universal terms that apply to all facets of life. Insurance gives certainty – this is incredibly important to the business world, but it is also incredibly important for the day to day lives of people. In this video I complete an argument I made in my previous video "Insurance in Islam: Halal or Haram?" Despite this, no one argues that buying an Apple phone is forbidden in Islam. And in between halal and haram, there are doubtful matters. Insurance Halal or Haram. As Prophet Mohammad (P.B.U.H) specified the things into three categories, therefore we must follow … But this discussion will be limited to food products, meat products, cosmetics, personal care products, pharmaceuticals, food ingredients, and food contact materials. Answer. Perhaps many of the readers know someone close to them who has gone through such hardship. The definition of halal fish also adds that, it needs to be caught alive from the water no matter what the fishing method is. If you think of gambling as an unnecessary assumption of risk that can cause financial loss, the logical question to ask is not whether having insurance is gambling but rather is, With all the unexpected expenses that we face in life, and how expensive things have become, and the fact that many people go bankrupt. Now, of course, those who think insurance is prohibited in Islam have specific objections that they cite so I’d like to address these objections in a way that should leave no doubt for the reader. Many would probably say working for a life insurance company is also haraam. Circumstance, in particular where the muslim community and its economy is targeted such times need to warrant conventional insurance to be opted for otherwise thru Takaful the net economic loss will be on the targeted muslim society. Thus I think u can add some thoughts FRM my comment to the very intellectually argued article of yours- mr author. You may be wondering what I think about Takaful, erroneously referred to as “Islamic insurance”, I encourage you to read here to find out. We know that one of the reasons Islam prohibits gambling is because it often causes financial hardship for the players. So the point I’m driving at is, the takaful industry has already compromised somewhat on the pure blood money setup for practicality purposes, and in so doing made itself near identical with a conventional insurer. (INS) as determined by the Codex Alimentarius committee though only a subset of the INS additives is approved for use in the European Union. Insurance is an immense loss for the nation, and there is no evidence or excuse to be found in the actions of the kuffaar who have lost the ties of kinship and friendship and are therefore forced to resort to insurance, which they hate as much as they hate death. Top Answer . So it definitely does not involve Riba. I also don’t appreciate the attack on a fellow Muslim. So I have insurance and was brought here seeking some Islamic views on home insurance. It looks like him standing around waiting for the one day in the year when he needs to earn his keep. Insurance per se is not haram. In other words, the insured is buying a legally binding promise from the insurer. If you turn on your car and you have no plan for what you’re going to do in case, God forbid, you get in an accident, I don’t think you can claim that you’ve thought things through. Islam forbids transactions in which there is gharar. Shark‚ Whale‚ Turtle etc. However, the only Haram I can only see is the part where the company you invest in uses it for usery or haram products. (In most cheeses). New Member : Dec 18, 2011, 01:22 PM As long as insurance does not deal with interest, it is allowed. Usman, Halal or Haram, Life Insurance: Halal or Haram? Pets Expert : Dec 2, 2009, 11:35 PM What? Finally, I find that when one examines modern-day examples of transactions deemed halal that involve a degree of gharar, e.g. Thank you Br. This is absolute bunkum. This promise is defined with the utmost amount of precision: You know how much the insurance company will payout, under what circumstances, and over what time period the promise to pay will remain active. So from the Quran, the actions and sayings of the prophet Muhammad (ﷺ) and the precedent set by Islamic history one can make a strong argument not only for the permissibility of insurance but its virtue as well. Mushbooh if used as liquid, the solvents has to be Halal. Dear and Beloved Brother, the concept of insurance per say in its essence is not prohibited in Islam; it is the riba or interest element, which is the financial back-bone of modern day conventional insurance, is what has been declared haraam and absolutely prohibited in Islam. Thus, they permitted many impure and harmful things and forbade many things that were good and pure. “Evidence” is already plural. In this situation, I don’t see a problem for Tesco, say, entering a year-long contract with a fishing company, to provide it whatever it catches, with the understanding that on average, x amount is what is expected. Is crypto trading halal or haram? As for the investment pool, fixed income is a much better hedge against the pool of future insurance claims than equity, consequently I would expect takaful operators if they are prudent to use fixed income instruments such as leases, sukuk, and declining balance Islamic mortgages. Much like the shariah compliant real estate models. People who have medical insurance don’t hope to fall ill, people who have disability insurance don’t hope to become disabled, people who have accident insurance don’t hope they get in a car accident. Fourth argument: you mentioned “You can buy a pair of sunglasses and lose them before you ever wear them, you can pay to have your car equipped with airbags and never get in an accident, you can purchase a fire alarm for your house and no fires ever happen.”. After all, the definition of a loan is an amount of money that you have to pay back. Brother Rakaan, could you please share your Islamic credentials / qualifications which permit you to share the halal / haram rulings on your website? Once one understands that Gharar arises not when the benefit of sale is unknown but rather when the object of sale is unknown and that the object of sale in insurance is a legally binding promise and not an amount of money, it’s immediately apparent that insurance does not involve any Gharar. Make of that what you will! I suspect this is the most controversial article to appear yet on IFG. In my previous article “Is insurance haram or halal?” (video above too), I discussed some of the main arguments for why insurance should be considered permissible from a Shari’ perspective. The Arabic word “halal” means “lawful” or “permit”, as opposed to “haram” which refers to the forbidden. Islam is the religion based on certain rules, and whoever breaks the rules will fall into the category of disbelievers, because the rules are set by the Creator of this universe. There are, then, independent positive arguments for why conventional insurance is beneficial and customary enough to fall among such categories and not the one of prohibited gharar. satswid1 Posts: 15, Reputation: 0. Your brother, I appreciate your courage in putting this out there and subjecting it to critique. There are a number of other benefits to insurance, some of which are excellently outlined in this article. Rennet or listed as enzyme Protein breaking enzymes used in cheese making • Halal if it is not from animal source. The fire alarm company or airbag company or sunglasses company do not worry about you using it or not, they are not praying you never get a chance to use their service rather they are more happy if you counter any situation where you have to use their service more often. It found that the most commonly consumed haram products are gelatin, lard, pepsin and food colouring, along with alcohol-derived ingredients. The concept of risk preference (gambling) is opposite to that of risk aversion (insurance). As you pointed out in the article this concept of takaful is an ancient practice and we just need to do what we can to apply it to modern times. The trickier question is, do consumers enjoy the same level of certainty? If you think of gambling as an unnecessary assumption of risk that can cause financial loss, the logical question to ask is not whether having insurance is gambling but rather is not having insurance a form of gambling? https://www.islamicfinanceguru.com/personal-finance/is-life-insurance-haram-or-halal/, How I Beat The Stock Market by 27% Consistently Over 4 Years, Imam Muslim records in his Sahih: “On the authority of Abu Hurairah who said that the Messenger of Allah (peace and blessings of Allah be upon him) forbade ‘sales of a speculative nature’ (bai al-gharar).”, Tirmidhi records the Prophet said “Do not sell that which you do not have.”, Al-Bukhari and Muslim record “On the authority of ibn Umar who said that ‘the Messenger of Allah (peace and blessings of Allah be upon him) prohibited the sale of fruits until their ripeness and freedom from disease were apparent. When we loose sunglasses or accident happen and airbags comes out or fire causes our fire alarm, we do know the output of the transaction unlike insurance they are only provided when the uncertainty is extreme. The basic premise I want you all to keep in mind is that Islam and the fuqaha do allow us to mitigate risk by pooling our wealth and paying out to those who lose out from an uncertain loss. Muslims are permitted to consume any fish as long as it has scales. Fatty acids and egg yolks of dried female insect Dactilopius coccus & … Excellent article and the hadiths really expand the understanding of insurance much more broadly than I have seen on most sites. HALAL / HARAM INGREDIENTS. In other words, both elements of interest which are the existence of a debt and an increase in the amount of that debt with the passing of time are absent in insurance. The debate is on how it is done, i.e. Halal Status: E100. Which in many ways, to me, helps solidify the inherent injustices in the systems with which we have concern. In my previous short article “Is insurance coverage haram or halal?” (video above too), I went over a few of the primary arguments for why insurance coverage need to be thought about acceptable from a Shari’ viewpoint. There are also some quite prominent modern scholars but I would not want to attribute complex positions to them without studying with them first, and it is best left to them to articulate their own positions should they feel the need to. The type of Riba which is being referred to is commonly known as interest. These righteous acts happen when people participate in insurance. Anyway, insurance companies only pay out an amount of money that is commensurate with the damages incurred and often the insured never even touches the money that is paid out by the insurance company; it goes directly to the medical care provider or to the auto mechanic or whoever provided the remedial service for the event that was insured against. Let’s look at hadith (7)-(9): These are just some of the hadith where the Prophet allowed for some uncertainty in the contract to make it easy for people and businessmen, or because it was a custom of the people, and where the benefit of allowing outweighed the harm. Halal or Haram?, insurance, Insurance in Islam: 5 objections ended, Opinion of Islam on Insurance. Curcumin/Turmeric. Halal and Haram in Islam. View all posts by Rakaan Kayali. http://islamicsystem.blogspot.dk/2007/02/prohibition-of-insurance-in-islam.html?m=1. Well, much of the opinions I hold on Islamic Financial matters are the mainstream ones, but as I have studied the topic of insurance more, I have increasingly found myself switching position. This system was known as “Aqila” amongst ancient Arabs. Page created - June 11, 2018. The author is moreover not referring to the shari’ evidences properly as is required when giving and Islamic verdict on a matter. It is a desperate attempt at searching for loopholes and circumventing what Islam has ordained. Page Transparency See More. Insurance in Islam: Halal or Haram? 133 check-ins. The argument against conventional insurance is that it involves riba (interest), gharar (uncertainty), and maysir (gambling). You are uncertain if you will ever have an accident after you buy car insurance and most people don’t and lose all their money for no return each year. And notice how in (7) the Prophet sets quite an easy bar for what is allowed. Or are these just personal opinions? Hi everybody, I think that it can't be a haram to just insurance a car. Shortening: Fats and oils of animal origin. The basic concept is that a bunch of people pool their money together not-for-profit to mutually cover each other’s backs. Durham University, England. I suppose a source of confusion for those who claim that insurance involves Gharar is that they think an amount of money is being purchased by the insured and that this amount of money is unknown. If this point is conceded, then really there are few substantive other differences between the two models. From a haram or halal perspective, there is nothing wrong with halal investing and earning a profit. Curcumin/Turmeric. The examples of Gharar the prophet (ﷺ) gave us are: the sale of fish in the sea, or birds in the sky, or an unborn calf in its mother’s womb. These are a flavour of the hadith dealing with gharar: From (1) we can see that trades involving gharar are not allowed, as we have already discussed. Some individual claimed that sometimes E471 maybe is stated as from plant origin by the food supplier but it is actually from pig fat. In the example you’ve given of members of tribes covering the blood money of their individual participants, I think governments are in the ideal position to provide such cover for their citizenry. With all the unexpected expenses that we face in life, and how expensive things have become, and the fact that many people go bankrupt even with the support of insurance, one can make a strong argument that voluntarily choosing to not have insurance is a form of gambling. Halal is an Arabic word meaning lawful or permitted. Please refer to our FAQ page. Post was not sent - check your email addresses! However, what you’ve purchased in the case of buying insurance is very precisely known, namely, a legally binding promise from the insurance company that it will cover a certain expense or pay out a certain amount in case a particular risk materializes. Type of Code. Let’s start with objection #1: Insurance involves Gharar (deception or unnecessary ambiguity); This is because the benefit received from purchasing insurance is unknown at the time of sale i.e. Options used as insurance, insurance also haram. This is a serious question, as I’m genuinely looking for answers, and one of the first things we’re taught as students of Deen is to understand who we’re learning from. It has been estimated that 80 to 90 percent of financial operations of some Islamic banks … One or two may be costly, but the other ones won’t require much work and the estate agent/law firm will be profitable in the end. So I believe we must be practical and intelligent but not weak and permissive. My concern is that we buy the western profit motive too easily sometimes. money. Put differently, for many commentators, the only identifiable elements in an insurance contract are the money the insured is paying and the money the insurer is promising to pay if a certain event occurs. Al-Bukhari and Muslim record the Messenger of Allah (PBUH) has allowed bay’ al-araya in quantities less than five awsaq (equivalent to approximately 653kg), meaning the sale of fresh dates on the palm in exchange for aged dried dates. I guess the source of confusion among those who claim insurance involves interest stems from the fact that an insurance contract is understood as a transaction involving only money. An insurance contract is a contingent claim, not a random event; consequently it cannot be equated to gambling. i don't wether it's true but i'm doing this just for my parents. The mistake in this argument is in the understanding of what Gharar is; it is being implied that Gharar arises in transactions where the benefit is unknown. Mushbooh if used as liquid, the solvents has to be Halal. I also find hadith (7) and (8) fascinating, not because they are precisely applicable here, but because they indicate that sometimes an unequal exchange in transactional matters is acceptable. A couple of my personal criticisms of the conventional insurance industry, for your consideration: 1. Curcumin/Turmeric . Based on this I find that insurance is permissible in Islam, it’s halal, and if you’re convinced with what I’ve said I encourage you to get insured against the major risks in your life especially health, automobile, and, Frankly, a more challenging question than: “Is insurance permissible in Islam?” is “Is, You may be wondering what I think about Takaful, erroneously referred to as “Islamic insurance”, I encourage you to read, [1]  Quran, fifth Sura (Sūrat al-māidah ), Verse 2 from. whether or not the insured collects any money or receives any benefit from purchasing insurance is dependent on unknown future events. 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