Ruling on Commercial Insurance and Its Exceptions
6-4-2026 | IslamWeb
Question:
Assalamu Alikum. I am a UK psychiatrist seeking a Shariah ruling on medical indemnity. While the NHS covers some duties, certain roles (e.g., MHA assessments, locums) require additional coverage. Currently, no Takaful-based (Shariah-compliant) options exist in the UK.Key Questions:Is there a Shariah-compliant alternative?If not, is conventional indemnity permissible due to professional necessity?Does the legal requirement to practice safely impact the ruling?
Answer:
All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad (ﷺ) is His Slave and Messenger.
The basic principle is that participating in commercial insurance voluntarily is prohibited. However, there may be situations in which a person is excused, especially in cases of general need, such as the situation of Muslim minorities in Western countries where no lawful alternative is available.
For this reason, the following is mentioned in a resolution of the European Council for Fatwa and Research:
“There are circumstances and environments that require finding solutions to address specific conditions and meet their needs, especially the situation of Muslims in Europe, where commercial insurance is widespread and there is a strong need to benefit from it in order to ward off risks they frequently face in their daily lives in all its forms. In addition, there is no available Islamic alternative—cooperative insurance—and it is currently difficult to establish. Therefore, the council issues a ruling permitting commercial insurance in the following cases and similar situations:
1. Cases of legal obligation, such as third-party car insurance, insurance for machinery, equipment, workers, and employees—such as social security or pensions—and some cases of health or educational insurance, and similar matters.
2. Cases of need in which avoiding hardship and severe difficulty is required, in which case the uncertainty present in commercial insurance is overlooked. Examples include:
1- Insurance for Islamic institutions such as mosques, centers, schools, and the like.
2- Insurance for cars, machinery, equipment, homes, and professional or commercial establishments, in order to protect against risks that cannot be reasonably covered, such as fire, theft, and disruption of essential services.
3- Health insurance to avoid extremely high costs that may affect the insured person and their family, especially in the absence of free healthcare, or due to delays or poor quality of available services.” [End quote].
Accordingly, the specific cases you are asking about should be examined. If they fall under these exceptions, or are similar due to need or severe hardship, then there is no blame in them. Otherwise, it is advisable to refer to fatwa councils in those countries to study each case, assess it properly, and issue a ruling accordingly.
Allah Knows best.