Transactions & Dealings >> Interest & Insurance

Question # : 1029


I want to take fatwa on the issue related to my sister married in Pakistan. Her husband died few months ago and he was working in a bank in Karachi. Now after his death the bank had given certain amount of money to my sister by saying that it is group Insurance money. But my brother in law never ever gave any amount no matter monthly, quarterly or yearly in the form of premium to the bank for this group insurance. The bank officials told that it is compulsory for all the employees working in that bank to take group insurance (which is provided free of cost by the bank to its employees) and the yearly premiums for that group insurance was being given by the bank and not by the employee. I will be highly grateful and thankful to you if can tell me (give fatwa) in the light of Islamic principles that the money is JAIEZ or HARAAM. Warm Regards?

Answer : 1029

Published on: Feb 13, 2008

بسم الله الرحمن الرحيم

(Fatwa: 438/436/M)


As mentioned above, the bank itself took group insurance on behalf of its employees. The employees neither demanded it nor do they have any say in the matter. So in this case, the definition of interest does not apply to the amount of group insurance given by the bank. Therefore, this amount will be considered as gift and benefaction from the bank to the relatives of the employees and thus it will be allowed to receive it.

Allah knows Best!

Darul Ifta,
Darul Uloom Deoband

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