Frequently Asked Questions
Usury / Insurance
Ref. No. 2773/45-4325
In the name of Allah the most Gracious the most Merciful
The answer to your question is as follows:
In the Holy Quran and hadiths, we are ordered with strict words to avoid usury and usury based transactions, even it is said that if those who take and give usury and do not repent, they should be ready to fight against Allah and His Messenger, so all kinds of usurious transaction is forbidden and Haram, thus the matter should not be taken for granted. Therefore, just as life insurance, medical insurance, etc. are prohibited, insurance of goods is also prohibited. You deposit extra money for a fixed period of time, during which you may not need to repair the equipment at all and lose the money. And maybe, so many repairs are needed that the insurers lose. So that is a form of gambling which is clearly prohibited in Islamic Shariah. If the service is given by the said company without an extra charge, it will be allowable and there should be no harm in it.
And Allah knows best
Darul Ifta
Darul Uloom Waqf Deoband