Extended warranty

[Hamza Asadullah]

Wassalamu alaikum

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.

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.

Asalaamu Alaikum, brother the safety valve is not fitted by chance it is fitted as standard as a safety measure to prevent the boiler shell from over heating and to relieve pressure so the boiler does not blow up so again your analogy does not work.

The OP was given a sufficient explanation to her question using a scholarly fatwa based on the Qur'an and Sunnah and it was enough to make her realise why extended warrantee and insurance is haraam. Here is another explanation of why extended warrantee is not permissable by Sheikh Aslam Abu Ismaeel:

Wa alaikumussalaam wa rahmatullah

Extended warranty on a purchased item in exchange for money is not permissible due to it being a payment of money for a return benefit that may or may not be acquired - this is the risk that is forbidden in Shariah as with gambling prohibition.

As for the company being prepared to repair it if it was faulty for the extended period of time, that should be like the basic warranty or else it would be risk type gambling and thus haraam.

As for the basic warranty, the reason it is halaal is that the company produced this item to a degree of quality that the item will be sound and functional for such a period of time. That is what the person is paying money for and if the item does not perform to what it was made for and paid for, then it is the fault of the company and thus repaired. This is the basic period of warranty. As for the extended one, had that item been made to stay that long, the price should not change as the price is paid for what is the reasonable expected time of functionality from such an item.

Thus the basic period of warranty is permissible where as the extended warranty in exchange for additional charge is not - and Allah knows best.

Wassalamu alaikum

Taken from: http://islamiclessons.com/forums/index.php?topic=384.0;wap2

 

[Trumble]

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.

Not up to me to argue with Islamic scholars, of course (as I assume the Qur'an says nothing about motor insurance!), but to me it makes no sense at all to equate it with 'gambling'. The gamble would seem to be not having comprehensive insurance; what if your car is essential to your job or family life? The insurance system is far from perfect, an accident may well be 'the other drivers fault', but on many occasions it's your word against theirs and the insurance companies split the cost. You are gambling, in effect that the other driver will confess all (or that you will never make a mistake yourself) which, in the UK at least, is extremely unlikely as, even if you are perfectly honest, your insurers instruct you not to accept any liability yourself and to let them sort it out.

And their are other kinds of insurance apart from those relating to property. What about public liability insurance? Or medical insurance?! Surely that is essential in many countries, even if not specified by law?

 

[Dagless]

Wassalamu alaikum


Asalaamu Alaikum, brother the safety valve is not fitted by chance it is fitted as standard as a safety measure to prevent the boiler shell from over heating and to relieve pressure so the boiler does not blow up so again your analogy does not work.

Ok last time The valve is fitted on the probability that all other measures fail. The probability of fires or burglaries is more than of the boiler safety valve being used. Read this: http://en.wikipedia.org/wiki/Safety_valve#Water_heaters - The thermostat (as well as a few other things- inlet, outlet, etc.) would need to fail before the safety valve is initiated. Sorry I know this isn't the place to be discussing central heating but I felt this point had to be cleared up.

The same is true for a fire sprinkler system; they are initiated only in case of fire. I am unsure of why it is halal to buy a sprinkler system but haram to buy insurance. I am not debating, I only wish to understand. You are essentially paying for protection from a possible scenario.

I keep an umbrella in the boot of my car - I am not gambling, but I know that one day it will rain. The same with car accidents - it is unlikely anyone could spend their entire driving life without some accident. In fact I would say believing you will never have an accident is more wrong because you are going against years and years of data and reason.

One for the scholars maybe.

 

[Hamza Asadullah]

Ok last time The valve is fitted on the probability that all other measures fail. The probability of fires or burglaries is more than of the boiler safety valve being used. Read this: http://en.wikipedia.org/wiki/Safety_valve#Water_heaters - The thermostat (as well as a few other things- inlet, outlet, etc.) would need to fail before the safety valve is initiated. Sorry I know this isn't the place to be discussing central heating but I felt this point had to be cleared up.

The same is true for a fire sprinkler system; they are initiated only in case of fire. I am unsure of why it is halal to buy a sprinkler system but haram to buy insurance. I am not debating, I only wish to understand. You are essentially paying for protection from a possible scenario.

I keep an umbrella in the boot of my car - I am not gambling, but I know that one day it will rain. The same with car accidents - it is unlikely anyone could spend their entire driving life without some accident. In fact I would say believing you will never have an accident is more wrong because you are going against years and years of data and reason.

One for the scholars maybe.

Asalaamu Alaikum, here is further explanation of why insurance is haraam from world authority on Islamic finance Justice Sheikh Mufti Taqi Usmani:

All forms of the commercial Insurance prevalent in the traditional Insurance companies are against the Islamic principles because they have either an element of riba or the element of qimar or gharar.

The basic cause of the impermissibility of the current methods of insurance is not that the insurance is against the concept of tawakul or taqdeer, that taking a precautionary measure against a possible loss or seeking a safe-guard against an accident does in no way contravene the concept of "Tawakkul" (placing one's trust in Allah) and of "Taqdeer" (Allah's will and destiny).

However, like any other act in this life, every measure of precaution must conform to the principles of Shari'ah and should not in any manner cross the limits prescribed by the Holy Qur'an and Sunnah.

It is a well settled principle of Shari'ah that every transaction between two parties in which the payment by one party to the other is certain and mandatory while payment by the other party depends upon a contingency (which may or may not occur) is included in qimar and gharar and is, therefore, unlawful.

The insurance of cars or other goods with the traditional Insurance Companies is a commercial transaction in which the person who wants to insure his goods is bound to pay a premium to the company in accordance with the prescribed conditions. This payment is certain and mandatory without which an insurance is not possible. But on the other hand, the payment by the company is not certain. It is contingent upon an event or accident which may or may not occur. If the accident takes place, the company is bound to pay an amount far more higher than the amount of the premium paid by the insured, but if the accident does not take place, the company does not pay to him anything and the premium paid by him goes without any return. In other words, the insured is bound to pay in any case while the company may or may not pay. Such kind of transaction is termed as gharar and Qimar and is strictly prohibited in Shari'ah.

Moreover, if the accident takes place, the amount of insurance is paid to the insured as a consideration of the amount of premium. It is again repugnant to the well-settled principle of Shari'ah that where money is exchanged for money, both the amounts should be equal in quantity. Any increase on either side is 'riba' which is clearly prohibited by the Holy Qur'an and Sunnah.

It is for these reasons that all the prevalent forms of commercial insurance have been held by the majority of the contemporary Muslim jurists as prohibited. This subject has been thoroughly discussed in different international seminars and conferences. Lastly, the question was also put before the Second Annual Session of the Islamic Fiqh Academy (established by the OIC) in Jeddah where all the Muslim countries were represented through their eminent scholars. After a detailed discussion of the subject, the Academy has adopted the unanimous resolution that the prevailing forms of insurance are prohibited in Shari'ah. However, the Muslim countries can develop their own system of insurance through the concept of takaful, waqf etc.

However, it should be remembered that since third party insurance is a mandatory legal requirement for every car-owner, he can effect this kind of insurance, because it is not possible for him to avoid it.

Although all of the conventional schemes of insurance violate certain injunction of Shariah and are therefore not permissible. However, if a Muslim is obligated by the law to have an insurance cover, it is permissible for him to have insurance up to the minimum level required by law. Since the third party insurance is obligatory by the law in most of the countries this has been allowed by the Shariah scholars but if full comprehensive insurance is cheaper than the third party insurance and it can fulfill the requirement of law and after that one does not need to enter into a third party insurance then it will be permissible to have full comprehensive insurance to meet the requirement of law. But two points must be kept in mind in this respect: First, merely on the ground that the full comprehensive insurance is cheaper, both kinds of insurance cannot be held simultaneously if the law does not require so. Second, in case the full comprehensive insurance is undertaken to meet legal requirement and the insured person is offered a compensation only to the extent of the total premium he paid to that company so far (it may include the premium to the same company with regard to some other items also) and the rest of the compensation must be given in charity.

If the car of a person is destroyed by a wrongful act of another person the owner of the car is entitled to receive the full market value of the car and not only the original cost of the car, but this market price is the liability of the person whose wrongful act caused the accident. Therefore, it is advisable that the aggrieved person receives the compensation from the owner of the car and not from the insurance company. But if it is not possible for some legal procedures in a country and the amount of compensation is paid by the insurance company directly to the aggrieved person and not to the insured person, the aggrieved person can also avail of this compensation.

And Allah knows best in all matters

 

[distressed]

Im not disputing anything, written in the quran. but i just dont see extended warranty as gambling ? sorry i dont. for me its a must, esp for things in the home, your always going to have a fault with one thing or another, boilers/machines, etc. i dont go a year without having a fault with a product. wat if my heating packs in ? am i supposed to get it all replaced potentially costing me hundreds ?? this thread could go on forever.

At the end of the day, I know im not buyin the extension 4 gambling reasons, more to save myself money, & im sure allah knows that too.

D

 

[Hamza Asadullah]

Im not disputing anything, written in the quran. but i just dont see extended warranty as gambling ? sorry i dont. for me its a must, esp for things in the home, your always going to have a fault with one thing or another, boilers/machines, etc. i dont go a year without having a fault with a product. wat if my heating packs in ? am i supposed to get it all replaced potentially costing me hundreds ?? this thread could go on forever.

At the end of the day, I know im not buyin the extension 4 gambling reasons, more to save myself money, & im sure allah knows that too.

D

Asalaamu Alaikum, if you read my posts in this thread properly then inshallah you will gain a better understanding of insurance. Please read all my posts in this thread once more as a request. Insurance is not directly gambling but a form of it. Everything you buy then it is Allah who has given you the means to buy it. If you are going to pollute what you bought by insuring them when you know now that it is forbidden then you will have to answer for that on the day of judgement or even suffer for it in this world and it may be that you may have even bigger losses because of the fact that you insured the items when you know now that it is forbidden.

In Islam there is fairness and wisdom in everything that is ordained on us and everything that is commanded on us is the best for us. So now that you know sister act upon it and inshallah Allah will give you more and you will gain peace and blessings in everything you do but if you choose not to because of following your own desires on a matter then you will have to face the consequances that will come to you because of the decisions you made. It is entirely upto you for all i can do is advice you on what is best for you.

And Allah knows best in all matters

 

[distressed]

Asalaamu Alaikum, if you read my posts in this thread properly then inshallah you will gain a better understanding of insurance. Please read all my posts in this thread once more as a request. Insurance is not directly gambling but a form of it. Everything you buy then it is Allah who has given you the means to buy it. If you are going to pollute what you bought by insuring them when you know now that it is forbidden then you will have to answer for that on the day of judgement or even suffer for it in this world and it may be that you may have even bigger losses because of the fact that you insured the items when you know now that it is forbidden.

In Islam there is fairness and wisdom in everything that is ordained on us and everything that is commanded on us is the best for us. So now that you know sister act upon it and inshallah Allah will give you more and you will gain peace and blessings in everything you do but if you choose not to because of following your own desires on a matter then you will have to face the consequances that will come to you because of the decisions you made. It is entirely upto you for all i can do is advice you on what is best for you.

And Allah knows best in all matters

I dont need to read them again, i understand, what you said, im not thick. This whole topic is just odd. The life insurance, your right on that, i never looked at it that way, but the original Q with regards to extended warranty, well for me to replace:

heating/boilers/machines
electrical appliances (tv, radio, hair dryer, vacums, food processors, kettle toasters, etc)
house contents/building works.

against wear and tear/accidental/deliberate damage/just isnt feasible. I would forever be paying out extorniate amounts of money, throughout the year, to get these things replaced.

what about pet/health/maternity insurance ? these things esp in other countries is essential.

I also asked about people with businessess, its a way of protection against the above. I dont believe anyone would open up a business, with no insurance. If someone burns your building down whats a person to do ?
you know more than me, but Im sorry theres just no logic behind this, and im not the only that thinks this. also its not about following my own desires, im saving myself from ending up on the street.

D