Insurance: Claims

Q284 :Is it permissible to claim the cost of car repairs, which have resulted from a road accident, under an insurance policy? How much should one claim: the cost of the repairs or the premium paid?

A284 : I have recently explained that insurance is permissible, because it safeguards the interests of people and reduces the burden of catastrophe that may happen from time to time. Moreover, it presents an agreement to share the burden among so many people who are liable to have the same sort of disaster. It is in effect a pledge of cooperation between a large number of people to reduce the effects of disaster which may befall a smaller number of them. Therefore, it is perfectly legitimate to claim your costs under insurance policy. The choice is not open to you of how much you should claim. The insurance company will pay for your repairs, but it will not refund your premiums. What you have already paid in premium has gone to finance other claims. What you get from an insurance company is paid by other people who also subscribe to the same insurance scheme. An insurance company does not work on the basis of saving the premium of every client. That would have been unfair. It works on the basis of giving complete insurance cover from the moment you sign your document and pay your first premium. You may leave the offices of the insurance company, having done that and drive away. Five minutes later, you may have an accident and the insurance company will pay you the costs of your repairs and any other benefits to which you may be entitled under the provisions of your insurance policy. That is perfectly alright and it is what clients of the insurance company expect. If it was simply a refund of their premiums, you would have been paid back the same amount you paid them and that would have given you no insurance cover whatsoever. It would have simply given you a refund. The whole purpose of insurance would have been rendered futile. Anyone would have been better off putting his money away in a safe or somewhere handy. That is definitely not the idea of insurance.

Our Dialogue ( Source : Arab News - Jeddah )