Question:-
I purchased a vehicle via an Islamic bank, which was in accordance to Shariah. However, I have to subscribe to an insurance policy known as Takafol when financing the vehicle. Is it permissible to subscribe to Takafol insurance, and if not, how can the matter be resolved?
Answer:-
We assume from your query that you have no issue with the bank finance as it is in accordance to Shariah (according to you) but your issue is the insurance required by the financer.
One way of overcoming the issue is by procuring an interest free loan from either some friend or family member which should then be used to offset the bank loan. You will then pay the friend or family member until the debt is paid in full. In this case you will not have to subscribe to any insurance policy.
The second option will be to sell the vehicle either privately, or to a reputable dealer, and offset the bank loan. You may then purchase a cheaper vehicle within your means, or by securing a private loan until Allah Ta’ala opens the way. By adopting this option, you will be protected from subscribing to an insurance policy as well.
Due to the impermissibility of all types of insurance in the light of Quraan and Hadith, we do not approve of any insurance, whether Takaful or otherwise.
ALLAH TA’ALA KNOWS BEST!
ANSWERED BY:
Mufti Mohammed Desai
Date: 03 Rajab 1443 / 05 March 2022
