Q: What is the ruling on life insurance? Does the ruling differ if one truly thinks ‘they need it’, as oppose to seeking financial security. And lastly, is it OK for them to take it if they have found an edict espousing a view holding it as permissible?
الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب
A: According to the overwhelming majority of Muslim scholars conventional insurance, including conventional life insurance, is not permitted. Whilst a minority of scholars have tried to reason for the permissibility of conventional insurance such reasoning has generally been rejected hence the emergence of takāful based Sharī’ah compliant models of insurance. If one feels the need to take out a policy that will provide for their offspring in the event of their death then one should seek a Sharī’ah compliant alternative. If no such alternative is available one cannot take out a conventional policy out of a fear for what may or may not happen in the future.