Extended warranty

[innocent]

Salam alaikum.
Is buying extended warranty haram. Isnt it just like insurance. My 12 month standard warranty is ending for my washing machine and I'm receiving letters telling me to purchase extended warranty for 4 years. I would like to purchase it but am afraid it may be haram. Does anyone here know?
JazakAllah khair.

 

[distressed]

I saw sumthing on 1 of the islamic channels not long ago, regarding this. I dont think its haram, its extra cover, if your product goes faulty, to avoid you wasting your money. we have warranty for everything at home, tv/freezer/cooker its a must, if it breaks down in 6 months time, you dont wana be forking out for another washing machine do you ?

D

 

[Hamza Asadullah]

Salam alaikum.
Is buying extended warranty haram. Isnt it just like insurance. My 12 month standard warranty is ending for my washing machine and I'm receiving letters telling me to purchase extended warranty for 4 years. I would like to purchase it but am afraid it may be haram. Does anyone here know?
JazakAllah khair.

Asalaamu Alaikum, jazakallahu Khayran for your question. Your answer is here:

It is permissible to purchase an extended warranty only at the time of purchasing the item. The value of the extended warranty will be regarded as the full purchase price of the item.

It is not permissible to purchase an extended warranty separately after purchasing the item.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai

Taken from: http://www.islam.tc/cgi-bin/askimam/ask.pl?q=13430&act=view

My sister if you do what is permissable and keep away from that which is impermissable then do you think Allah will not bless you in everything that you do? Then have reliance in Allah for it is he who gave you that washine machine and everything you own so it is he who will do what is best for you in regards to everything you own if you do things which are permissable and stay away form those that are not or where there is any doubt on the matter.

And Allah knows best in all matters

 

[innocent]

But isnt it just the same as purchasing insurance? And insurance is haraam.

 

[distressed]

Asalaamu Alaikum, jazakallahu Khayran for your question. Your answer is here:

It is not permissible to purchase an extended warranty separately after purchasing the item.

sorry this just makes no sense ? when you purchase a product, you get 12 months warranty included, so if that runs out, why is it haram to buy an extension ?? is that cheaper than buying a whole new machine ?? anyway, i saw this same question being answered on islam Q&A so do i just disregard it then ??

 

[distressed]

But isnt it just the same as purchasing insurance? And insurance is haraam.

insurance is haram ?? really ? but car insurance is a must ? as is home contents insurance, to protect you from burgalaries/fire etc ?

 

[innocent]

All. But as its illegal to drive a car without insurance that is allowed but only for the minimum third party and not comprehensive. Allah knows best.

 

[distressed]

All. But as its illegal to drive a car without insurance that is allowed but only for the minimum third party and not comprehensive. Allah knows best.

didnt know that. Im fully comp anyway. I get why interest is haram etc, but insurance is a totally different thing, esp wen your protecting yourself from wasting more money, which imho is even more haram. every1 has this, where i live, some even have life insurance, business insurance, pet insurance, the list goes, on, and if its haram it is, but i did use to have a life policy not so long ago that was set up by some1 else.

 

[Hamza Asadullah]

sorry this just makes no sense ? when you purchase a product, you get 12 months warranty included, so if that runs out, why is it haram to buy an extension ?? is that cheaper than buying a whole new machine ?? anyway, i saw this same question being answered on islam Q&A so do i just disregard it then ??

Asalaamu Alaikum, If the warranty was inclusive in the price then it is permissable to have that warranty but if the warranty is bought as an addition or as an extention then it comes under insurance which is forbidden in Islam.

The reason why all forms of commercial insurances prevalent in modern trade are unlawful and against the principles of Shari’ah, is that they have either an element of interest (riba) or chancing (qimar), both of which have been explicitly and sternly forbidden by Allah Most High in the Qur’an:

“Those who swallow usury cannot rise up save as he ariseth whom the devil hath prostrated by (his) touch. That is because they say: Trade is just like usury; whereas Allah permitteth trading and forbiddeth usury. He unto whom an admonition from his Lord cometh, and (he) refraineth (in obedience thereto), he shall keep (the profits of) that which is past, and his affair (henceforth) is with Allah. As for him who returneth (to usury) - Such are rightful owners of the Fire. They will abide therein.

Allah hath blighted usury and made almsgiving fruitful. Allah loveth not the impious and guilty.

Lo! those who believe and do good works and establish worship and pay the poor-due, their reward is with their Lord and there shall no fear come upon them neither shall they grieve.

002.278 O ye who believe! Observe your duty to Allah, and give up what remaineth (due to you) from usury, if ye are (in truth) believers.

And if ye do not, then be warned of war (against you) from Allah and His messenger. And if ye repent, then ye have your principal (without interest). Wrong not, and ye shall not be wronged.” [Qur’an, 2.275-279]

And, regarding chancing and gambling (qimar):

“They question thee about strong drink and chancing. Say: In both is great sin, and (some) utility for men; but the sin of them is greater than their usefulness. And they ask thee what they ought to spend. Say: that which is superfluous. Thus Allah maketh plain to you (His) revelations, that haply ye may reflect.” [Qur’an, 2.219]

And:

“O ye who believe! Strong drink and chancing and idols and divining arrows are only an infamy of Satan's handiwork. Leave it aside in order that ye may succeed.” [Qur’an, 5.90]

The Ruling Regarding Prevalent Forms of Insurance

Insurance is chancing [= ‘relying on or inviting the risks of chance’ – Merriam-Webster’s Unlimited Dictionary] in the sense that the premiums are paid for certain, where as the return is uncertain. You may loose all the premiums you paid or may receive in return more then what you paid. This is known as chancing. There is also interest as money is being exchanged here for money and one party pays less and receives more in return.

This is the reason why the great contemporary scholars from all over the world have declared all types of prevalent insurances unlawful (haram), unless when one is compelled to effect it by the Government.

The Islamic Fiqh Academy (Jeddah), and which consists of top recognized scholars from around the globe researched the issue in considerable depth. The meeting was attended by no less than 150 such scholars from 45 Islamic Countries, including my respected teacher Shaykh Mufti Muhammad Taqi Usmani (may Allah preserve him), and they unanimously declared all types of prevalent insurances to be unlawful.

How About Car Insurance?

However, it should be remarked here, that since third party car insurance is a mandatory legal requirement for every car-owner, one can affect this kind of insurance, as it is not possible for one to avoid it.

Is There An Alternative?

Islamic financial institutions offer a viable and Islamically-accepted alternative, which is takaful, a form of cooperative insurance. Details of this are available through such institutions.

And Allah knows best

Muhammad ibn Adam al-Kawthari

Taken from: http://qa.sunnipath.com/issue_view.asp?HD=1&ID=383&CATE=43

 

[distressed]

Asalaamu Alaikum, If the warranty was inclusive in the price then it is permissable to have that warranty but if the warranty is bought as an addition or as an extention then it comes under insurance which is forbidden in Islam.

The reason why all forms of commercial insurances prevalent in modern trade are unlawful and against the principles of Shari’ah, is that they have either an element of interest (riba) or chancing (qimar), both of which have been explicitly and sternly forbidden by Allah Most High in the Qur’an:

“Those who swallow usury cannot rise up save as he ariseth whom the devil hath prostrated by (his) touch. That is because they say: Trade is just like usury; whereas Allah permitteth trading and forbiddeth usury. He unto whom an admonition from his Lord cometh, and (he) refraineth (in obedience thereto), he shall keep (the profits of) that which is past, and his affair (henceforth) is with Allah. As for him who returneth (to usury) - Such are rightful owners of the Fire. They will abide therein.

Allah hath blighted usury and made almsgiving fruitful. Allah loveth not the impious and guilty.

Lo! those who believe and do good works and establish worship and pay the poor-due, their reward is with their Lord and there shall no fear come upon them neither shall they grieve.

002.278 O ye who believe! Observe your duty to Allah, and give up what remaineth (due to you) from usury, if ye are (in truth) believers.

And if ye do not, then be warned of war (against you) from Allah and His messenger. And if ye repent, then ye have your principal (without interest). Wrong not, and ye shall not be wronged.” [Qur’an, 2.275-279]

And, regarding chancing and gambling (qimar):

“They question thee about strong drink and chancing. Say: In both is great sin, and (some) utility for men; but the sin of them is greater than their usefulness. And they ask thee what they ought to spend. Say: that which is superfluous. Thus Allah maketh plain to you (His) revelations, that haply ye may reflect.” [Qur’an, 2.219]

And:

“O ye who believe! Strong drink and chancing and idols and divining arrows are only an infamy of Satan's handiwork. Leave it aside in order that ye may succeed.” [Qur’an, 5.90]

The Ruling Regarding Prevalent Forms of Insurance

Insurance is chancing [= ‘relying on or inviting the risks of chance’ – Merriam-Webster’s Unlimited Dictionary] in the sense that the premiums are paid for certain, where as the return is uncertain. You may loose all the premiums you paid or may receive in return more then what you paid. This is known as chancing. There is also interest as money is being exchanged here for money and one party pays less and receives more in return.

This is the reason why the great contemporary scholars from all over the world have declared all types of prevalent insurances unlawful (haram), unless when one is compelled to effect it by the Government.

The Islamic Fiqh Academy (Jeddah), and which consists of top recognized scholars from around the globe researched the issue in considerable depth. The meeting was attended by no less than 150 such scholars from 45 Islamic Countries, including my respected teacher Shaykh Mufti Muhammad Taqi Usmani (may Allah preserve him), and they unanimously declared all types of prevalent insurances to be unlawful.

How About Car Insurance?

However, it should be remarked here, that since third party car insurance is a mandatory legal requirement for every car-owner, one can affect this kind of insurance, as it is not possible for one to avoid it.

Is There An Alternative?

Islamic financial institutions offer a viable and Islamically-accepted alternative, which is takaful, a form of cooperative insurance. Details of this are available through such institutions.

And Allah knows best

Muhammad ibn Adam al-Kawthari

Taken from: http://qa.sunnipath.com/issue_view.asp?HD=1&ID=383&CATE=43

what you've sed makes sense, It just makes no sense to me, how wasting money is ok ? for example if i get home insurance, and my house burns down, or get burgled etc and i have no job etc, im supposed to live with nothing ? anyway if its haram it is, i just see it as extra protection.

 

[Hamza Asadullah]

what you've sed makes sense, It just makes no sense to me, how wasting money is ok ? for example if i get home insurance, and my house burns down, or get burgled etc and i have no job etc, im supposed to live with nothing ? anyway if its haram it is, i just see it as extra protection.

Wasting money is actually gambling it on the fact that you may or may not ever get burgled. It is quite highly unlikely that you will ever get burgled and if you don't then you have in fact wasted all that money that you gave away as insurance. It is the same as gambling as you are taking a gamble on the fact that if you do get burgled then you may get something back but if you don't then you have gambled all of that money away. Sameway if i were to gamble £10 on the lottery then i am taking a gamble that for this £10 i may win millions of pounds but if i lose (Which is highly likely) then i have gambled that money away and wasted it. Gambling is forbidden because you ALWAYS lose more than you have gained. Ask any gambler and they will tell you that.

Do you now see the connection between insurance and gambling? It is but the same thing. Insurance is in fact gambling so my sister we must not gamble as Allah has stated in the Qur'an. It is he who has bought you all of the things you have and it is he who gives you your sustainance. You will be tested on how you spent what you have been given and if you have gambled any of it away in insurance then you will also have to answer for every penny and claiming that it is for protection does not make insurance permissalbe for that which is imppermisable will remain so not matter how it is sugar coated.

And Allah knows best in all matters

 

[distressed]

Wasting money is actually gambling it on the fact that you may or may not ever get burgled. It is quite highly unlikely that you will ever get burgled and if you don't then you have in fact wasted all that money that you gave away as insurance. It is the same as gambling as you are taking a gamble on the fact that if you do get burgled then you may get something back but if you don't then you have gambled all of that money away. Sameway if i were to gamble £10 on the lottery then i am taking a gamble that for this £10 i may win millions of pounds but if i lose (Which is highly likely) then i have gambled that money away and wasted it. Gambling is forbidden because you ALWAYS lose more than you have gained. Ask any gambler and they will tell you that.

Do you now see the connection between insurance and gambling? It is but the same thing. Insurance is in fact gambling so my sister we must not gamble as Allah has stated in the Qur'an. It is he who has bought you all of the things you have and it is he who gives you your sustainance. You will be tested on how you spent what you have been given and if you have gambled any of it away in insurance then you will also have to answer for every penny and claiming that it is for protection does not make insurance permissalbe for that which is imppermisable will remain so not matter how it is sugar coated.And Allah knows best in all matters

ok. I wasnt sugar coating anything, its just how i see things, like i mentioned before i didnt know insurance was haram. every1 i know has it. Thats the thing, im not spending my money to gain anything, and actually we have been burgled before. home insurance to me, is a must, esp including the building, chances are you are going to get affected, with plumbing/damp etc.

the OP was asking about extended warranty, and as i had seen it on islam Q&A saying its not haram ? you can see my confusion. everything in our house is insured. you wouldnt run a business, without insurance would you. I did look into life insurance a while ago, but knowing what i do now, i'll leave it.

you know more than me, so i get it.

 

[Dagless]

I don't see what gambling or interest have to do with an extended warranty. A warranty on an item shows the manufacturers confidence that the item will not go wrong. If it does go wrong then they will pay for repairs. Btw in reply to the original post, wouldn't a washing machine be covered under your home insurance anyway?

Wasting money is actually gambling it on the fact that you may or may not ever get burgled. It is quite highly unlikely that you will ever get burgled and if you don't then you have in fact wasted all that money that you gave away as insurance.

It is highly unlikely that a boiler will malfunction so is it haram to have a safety valve fitted? It costs extra money and is based upon the chance that the boiler malfunctions. How is this different to what you're saying? The chance something goes wrong is small, but the losses will be large.

It is the same as gambling as you are taking a gamble on the fact that if you do get burgled then you may get something back but if you don't then you have gambled all of that money away. Sameway if i were to gamble £10 on the lottery then i am taking a gamble that for this £10 i may win millions of pounds but if i lose (Which is highly likely) then i have gambled that money away and wasted it. Gambling is forbidden because you ALWAYS lose more than you have gained. Ask any gambler and they will tell you that.

But what happens if you do get burgled? What you lose is worth far more than it would have cost you to insure. You are also not hoping to get burgled when you buy insurance, whereas with the lottery you hope to win.

Do you now see the connection between insurance and gambling? It is but the same thing. Insurance is in fact gambling so my sister we must not gamble as Allah has stated in the Qur'an. It is he who has bought you all of the things you have and it is he who gives you your sustainance. You will be tested on how you spent what you have been given and if you have gambled any of it away in insurance then you will also have to answer for every penny and claiming that it is for protection does not make insurance permissalbe for that which is imppermisable will remain so not matter how it is sugar coated.

Even if it is gambling it would not be you who is gambling; it is the insurance company who works out the odds and charges.

 

[innocent]

Btw in reply to the original post, wouldn't a washing machine be covered under your home insurance anyway?

Probably if I had home insurance yes. But as insurance is haram I dont have it.

 

[distressed]

I don't see what gambling or interest have to do with an extended warranty. A warranty on an item shows the manufacturers confidence that the item will not go wrong. If it does go wrong then they will pay for repairs. Btw in reply to the original post, wouldn't a washing machine be covered under your home insurance anyway?

I always get warranty, for household stuff like vacums/hairdryers, etc, cos i always end up taking stuff back, within the 12 months. Its far cheaper for me to pay £5 insurance for 2 years guarantte on a vacum, then it is for me to fork out anything up to £100 for a new one.

you sed it better, than what i was trying to get at.

 

[Hamza Asadullah]

ok. I wasnt sugar coating anything, its just how i see things, like i mentioned before i didnt know insurance was haram. every1 i know has it. Thats the thing, im not spending my money to gain anything, and actually we have been burgled before. home insurance to me, is a must, esp including the building, chances are you are going to get affected, with plumbing/damp etc.

the OP was asking about extended warranty, and as i had seen it on islam Q&A saying its not haram ? you can see my confusion. everything in our house is insured. you wouldnt run a business, without insurance would you. I did look into life insurance a while ago, but knowing what i do now, i'll leave it.

you know more than me, so i get it.

Just to clarify sister i did not mean that you sugar coated anything i meant as in companies when they are trying to promote and market insurance products then they do everything in their power to sugar coat it and make it out to the customer that it is essential that they get this insurance product otherwise this or that would happen. I know because i have done plenty of professional sales over the years and i know how it all works. The fact is they say you need it but you do not actually need it.

Compulsory insurance is something we cannot avoid and scholars are aware of this and that is why they say that if a certain insurance is compulsory then one can get the lowest one possible for example in car insurance one should get the third party as oppossed to full comp.

Here is more explanation on why conventional insurance is not permissible in Islam:

Conventional insurance contains elements contradictory to Islamic Shari’ah.

Gharar: “Uncertainty”

The insurance contract contains uncertainty due to:

Uncertainty whether the payment will be accepted as promised
The amount to be paid is not known
The time it will occur is not known
Any form of contract which is lopsided in favour of one party at the expense and unjust loss to the other is classified as Gharar.

When a claim is not made the insurance company may acquire all the profits whilst the participant may not obtain any profit whatsoever. The loss of premiums on cancellation of a life insurance policy by the policyholder, or the "double standard" condition of charging a customary short period in general insurance, whilst only a proportional refund is made if the insurance company terminates the cover is also considered as unjust.

Maisir: Gambling

The participant contributes a small amount of premium in hope to gain a large sum
The participant loses the money paid for the premium when the insured event does not occur
The company will be in deficit if claims are higher than contributions
When a life insurance policyholder dies after only paying part of the premium his dependants receive a certain some of money which the policyholder has not been informed of and has no knowledge as to how and from where it has been derived.

Riba: Interests

An element of interest exists in conventional life insurance products - as the insured, on his death, is entitled to get much more than he has paid
Insurance funds invested in financial instruments such as bonds and stocks contain and element of Riba

And Allah knows best in all matters

 

[Hamza Asadullah]

I don't see what gambling or interest have to do with an extended warranty. A warranty on an item shows the manufacturers confidence that the item will not go wrong. If it does go wrong then they will pay for repairs. Btw in reply to the original post, wouldn't a washing machine be covered under your home insurance anyway?


It is highly unlikely that a boiler will malfunction so is it haram to have a safety valve fitted? It costs extra money and is based upon the chance that the boiler malfunctions. How is this different to what you're saying? The chance something goes wrong is small, but the losses will be large.

But what happens if you do get burgled? What you lose is worth far more than it would have cost you to insure. You are also not hoping to get burgled when you buy insurance, whereas with the lottery you hope to win.

Even if it is gambling it would not be you who is gambling; it is the insurance company who works out the odds and charges.

Asalaamu Alaikum, A warranty which comes with a product is inclusive of the price and comes with the product as standard but to purchase additional cover is just another form of insuring it.

The fact of the matter is that all types of conventional insurance is forbidden unless it is compulsory. Please go back to the Islamic explanations which i have posted in this thread where the Qur'an was even quoted. This is not a matter that can be disputed or debated. What is forbidden will remain so and what is permissable will also remain so.

And Allah knows best in all matters

 

[Dagless]

Asalaamu Alaikum, A warranty which comes with a product is inclusive of the price and comes with the product as standard but to purchase additional cover is just another form of insuring it.

The fact of the matter is that all types of conventional insurance is forbidden unless it is compulsory. Please go back to the Islamic explanations which i have posted in this thread where the Qur'an was even quoted. This is not a matter that can be disputed or debated. What is forbidden will remain so and what is permissable will also remain so.

And Allah knows best in all matters

Walaikum Salaam. I did read them but, as I mentioned in my reply, I cannot see a clear parallel between warranties and usury or games of chance.
Please also answer my points, especially how my boiler example differs.

 

[Hamza Asadullah]

Walaikum Salaam. I did read them but, as I mentioned in my reply, I cannot see a clear parallel between warranties and usury or games of chance.
Please also answer my points, especially how my boiler example differs.

Buying an extended warranty beyong the warranty expiration date is just another term for insuring the product for a fixed perioud of time. So a warranty extention which one has to pay for is in fact one insuring the product therefore not permissable.

In regards to the safety valve in a boiler, it is a very important boiler fitting which has to be used in boilers to protect the boiler shell from over pressure and subsequent explosion. So therefore it is a safety measure which has to be fitted into every boiler so your analogy does'nt actually work. You can think up of any analogy you like, the fact still remains insurance is forbidden and it will always remain so. If you are in dispute of this then you are in dispute of the commandments of Allah. It is as simple as that.

And Allah knows best in all matters

 

[Dagless]

In regards to the safety valve in a boiler, it is a very important boiler fitting which has to be used in boilers to protect the boiler shell from over pressure and subsequent explosion. So therefore it is a safety measure which has to be fitted into every boiler so your analogy does'nt actually work.

The point was that the fitting is based on chance. I am trying to show how not all things based on chance are haram. The number of boilers likely to fail is very small compared to the number of house fires, burglaries etc. The same goes for car airbags, smoke alarms, etc. etc.

You can think up of any analogy you like, the fact still remains insurance is forbidden and it will always remain so. If you are in dispute of this then you are in dispute of the commandments of Allah. It is as simple as that.

And Allah knows best in all matters

I am not in dispute of the commandments of Allah, I am only trying to get an explanation since the evidence shown does not answer the questions posed.