Q. Is it permissible to have insurance on your home to cover against fire, burglary, flood, earthquakes, etc.? Is it permissible for importers and wholesalers to take out insurance on their goods?
A. Although insurance is seen to be a security against unfortunate occurrences, it is nevertheless connected to uncertainty and interest which are both haram in Islam. For this reason, most of the scholars have stated that it is not permissible in Islam whether it is for fire, flood etc. or for importing goods etc.
However, on account of the great losses that can occur at the time of natural disasters, and also the losses which can occur while importing goods from foreign countries, some scholars have allowed insurance only for these purposes to the extent of dire need and necessity.
And Allah knows best.
Mufti Waseem Khan