Question : What is the ruling on working in insurance companies?

Fatwa in Brief: It is not permitted to work as an employee for such companies. Insurance is forbidden (haram) and working [within such companies] is a means of supporting evil and injustice.

The Permanent Committee, 8/15

Response:

The question of whether or not a Muslim may work in a business insurance company depends upon the legal status of insurance itself [as discussed in the previous fatwa]. Whoever follows the majority of scholars, in saying that it is prohibited, will agree that working in such a company is also prohibited. [On the other hand] If a person follows the [rulings of] scholars who judge business insurance to be compatible Islamic law, s/he is permitted to work in these companies.

Commentary:

Scholars agree that it is allowed to work in Islamic insurance and/or aid agencies. If we follow those jurists who consider business insurance prohibited, then working in business insurance companies is also prohibited, because of the risk and harm that this involves. Indeed [in our view], working in this area is not allowed. For, in His Holy Book, God forbade Muslims from supporting evil and injustice [in any way]. Yet, whoever believes that business insurance is compatible with Muslim law is free to work in this field. This situation is a cause for suspicion (shubha), however. And anyhing that is a cause for suspicion is [likely to be] forbidden (haram), or close to forbidden for Muslims. To this effect, there is a hadith in the collections of al-Bukhari and Muslim which states: “The permitted is clear and the prohibited is clear. Yet, between them are doubtful matters grasped by only a few people. Those of you who stay away from such matters protects their religion and honor; while those of you who fall into these matters has already fallen into what is prohibited. In this sense, you are shepherd who grazes your sheep [on a cliff], and the herd teeters on its edge”.

A true believer looks to safeguard him/herself. Thus, s/he will not look for work that raises suspicion as regards the law. S/he [the true believer] needs only to covers life’s necessities, and does not yearn for luxury. If, however, after searching diligently and finding that there is no legally permitted work available, s/he may accept a job in this field. Yet, s/he must continue to search for another job until s/he finds it. If his/her intention is sincere, God will make this search easy for him/her:

“Whoever keepeth his duty to Allah, Allah will appoint a way out for him, And he wil provide for him fropm a (quarter) whence he hath no expectation”. (Q. 65:2-3)

And God also says:

“Whoever keepeth his duty to Allah, He maketh his course easy for him”. (Q.65:4)[1]

Dr. Anas Abu Shadi