The Need For Protection

Every member of the community in his day-to-day life is invariably exposed to the possibility of encountering catastrophe, disaster and mishap which may give rise to all sorts of misfortune and tragedy such as death, fire, burglary, motor accident, etc. For a Muslim he must believe in the catastrophe or disaster befalling him as `qada’ and qadar’ from Allah. In this respect he must face these unfortunate events with resilience, both spiritually and physically, with the strength of faith and patience. Nevertheless it is also the duty and responsibility of every Muslims to find ways and means to strive hard to avoid such catastrophe and disaster wherever possible, as well as to lighten his or his family’s burden in the event of such ill luck occurring.

Indeed it is the possibility of having to cope with such catastrophe and disaster that has made us realise the need to be adequately and fully prepared, in particular in terms of financial resources, should such event occur despite him striving hard to avoid it. Obviously to most people it would quite natural to wish that they would be able to provide their dependents and loved ones a certain the sum of money in the event of their death. They would feel secure in their knowledge as that sum of money would help to alleviate the misery and hardship that their dependents and loved ones may face resulting from such tragedy. For example, a person who is exposed to the dangers of his house catching fire or his motor vehicle meeting with an accident would always wish that he would have enough money to repair his house or his motor vehicle should such disaster did actually take place.

Perhaps one way to cope with such an eventuality is by way of personal savings. However, such measure may not always be sufficient as the sum of money required might be substantial and it takes time to save, whilst a catastrophe or disaster may strike at any time. Although personal savings are essential, in most cases it may be sufficient. Hence additional assistance and financial resources are critical.

Therefore it becomes necessary for us to be prepared. As a matter of fact, Islam encourages Muslims to do their utmost to be prepared and seek protection or cover in their activities as is clear in the following hadith “The Prophet (s.a.w) told a Bedouine Arab who left his camel untied to the will of Allah: Tie the camel and then leave it to the will of Allah” (Reported by Al-Tarmizi and Ibn Majah).

Until recently, one form of protection which a Muslim can avail himself as a means of cover against the consequences of catastrophe and disaster is through the insurance policies provided by conventional insurance companies. Basically, these companies offer two types of policy namely life insurance which essentially covers losses against death, and general insurance which covers losses against fire, motor vehicle, accident and the like.

However, the participation by Muslims in these insurance policies has raised doubts from the viewpoint of Syariah. In view of this, Muslim scholars had conducted a thorough and comprehensive study on the operations of the conventional insurance. Arising from this study, the generally accepted view of the scholars is that the operation of the conventional insurance does not in its present form comply and conform to the rules and requirements of the Syariah. It is indeed important to stress at the outset that it is not the concept but its practice which does not meet the rules and requirements of Syariah. On the contrary, the concept insurance which simply means pooling of common resources to help the needy is very much in line with the teachings of Islam which propagate solidarity, mutual help and cooperation among members of the community. Therefore insurance is not a practice to challenge the will of Allah or having little faith of His mercy.

As a matter of fact, the essence of insurance could be seen in the system of mutual help in relation to the custom of blood money or `diyah’ under the Arab tribal custom. Under this system, the victim would be compensated by the members of the community whose action had resulted in the loss of life or impairment of the victim. Therefore, the principle of compensation and group responsibility was accepted by Islam and the holy Prophet. Muslim scholars acknowledged that the basis of shared responsibility in the system of `aqila’ as practised between Muslims of Mecca (Muhajirin) and Madinah (Ansar) laid the foundation of mutual insurance. It is the pooling of common resources to help the needy, a scheme which is very much in line with the principle of compensation and shared responsibility among the community.

Although as a concept, insurance does not contradict the practices and requirements of Syariah, Muslim scholars however have generally concluded that it is the practice and operation as provided by the conventional insurance companies which do not conform to the rules and requirements of Syariah. Towards this end, in June 1972 the National Fatwa Committee resolved that the present-day life insurance business provided by the conventional insurance companies was not in line with the principles of Syariah. Similarly, in a comprehensive deliberation, the Fiqh Academy of the Organisation of Islamic Conference (OIC), at its gathering in December 1985 resolved that no form of insurance, life or general, conformed to Islamic principle.

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