Health Insurance


Health Insurance
Question: What is the ruling on benefiting from health insurance when no Islamic alternative is available?
Answer by Sheikh Sa`ūd al-Funaysān, former professor at al-Imām University
Health insurance is a modern issue that had not been known before – not by this name, nor by anything remotely resembling it. It is problematic in that it resembles life insurance which is certainly unlawful. However, health insurance differs from life insurance in a number of important ways.

1. Life insurance is a contract built upon the unknown. It has uncertainty with respect to the amount that has to be paid as well as with respect to the duration of time. Health insurance differs in that it is a contract for a benefit that is present or has the legal status of being present. Therefore, the contract is free of the unknowns and uncertainties that are inherent in life insurance and that make the life insurance contract an invalid one.

2. Life insurance is a contract of obligatory compensation, like a rental contract, and therefore must be free of unknowns, uncertainties, and the consumption of wealth without right. Health insurance, on the other hand, is a type of ongoing service contract. Such a contract accommodates a degree of unknown factors and uncertainty that is not tolerated in compensatory contracts.

Health insurance can be understood within the framework of Islamic Law as being a service contract with a fixed commission – known in classical Islamic legal texts as a ji`ālah contract. The jurists have stated within this context that the following would be a valid, legal contract: “Whoever tends to the patient until he recovers from his injury, sickness, or conjunctivitis, then he will receive such-and-such stated monetary compensation.”

Ibn Taymiyah writes:
The evidence for this is that it is permissible for a doctor to set a fee for healing a patient, in the same way that the Companions of the Prophet (peace be upon him) took a number of sheep for the recovery of the district chief. They had treated him by way of ruqyah until he recovered and then took the pre-agreed remuneration. Then the Prophet (peace be upon him) concurred with them in what they did, saying: “Apportion for me with you a share.”

The compensation was set was for recovery and not for the reading of the ruqyah itself. If on the other hand, a doctor is given a mandatory fixed wage for achieving the recovery of the patient, it would not be allowed, since it is not within his power to cure the patient. Allah might cure him or He might not do so. [Majmū` al-Fatāwā]
At present, insurance companies are commonplace, many of them offering health insurance. It may be that having such insurance is a necessity for a man and the members of his household. Unfortunately, most of these insurance companies do not comply with Islamic Law in their mode of operation. When dealing with such companies is a matter of necessity or obligation, there will be no problem in doing so. However, when doing so is merely a matter of personal preference, it is my opinion is that the policyholder should never draw from the policy more than he has paid into it, even if his medical expenses exceed that amount.

And Allah knows best.