Legal Perspective Of
Insurance In Islamic
The
legal stand of the Islamic community on insurance should be noted
before incorporating the product in the risk management plan of a
Muslim.
The
key question would be whether life insurance is haram or illegal
under Islamic law as parched in the country. This is an important
factor, as Muslims are not allowed to participate in schemes that are
considered haram to the religion.
As
a concept, insurance is not considered haram under Islamic law. In
fact, Muslim scholars have pointed out element of insurance existed
in Muslim society practices even during ancient times.
Life
insurance is a good example. The essential of Life insurance are
comparable to the system of mutual assistance in relation to the Arab
tribal custom of blood money, Muslim jurists recognized that the
basics of shared responsibility in the system of ‘aqila’ as
practiced between Muslims of Mecca (Muhajirin)and Meding (ansar)
laid the foundation of mutual Insurance.
The
generally accepted views of the Muslim jurists that conforms to the
rule and requirements of the Syariah as it embodies the following
three elements;
- Al-Gharar –unknown or uncertain factors
- Al-Maisir- gambling
- Al-Riba-interest
Muslim
jurists has developed a system of insurance which fall within the
ambit of Islamic setting of insurance on the concept of al-Takaful.
Early History
The
establishment of Islamic Insurances is generally considered to be in
the early second country of Islamic era when Muslim Arabs began to
expand their commercial dealings to India, Malaya and other countries
in Asia. (Ref:Malaysian
Financial Planning
Council)
About
the author:Kertar Singh has joint
Great Eastern Life Assurance in August 1995 as a part time agent.
Became a full time agent
in 2000 after retiring from the army after 22 years.
He deal with all kind of
Insurance from Life Insurances to General Insurances and Will
Writing.
Kertar.en@gmail.com
H.P 013-322 8582
Notes: Reference have
been made from MII and Gela
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