insha’a for various reasons. First, insurance companies must

insha’a Allah, Insha’Allah?Literally,
‘God willing’. Often said by Muslims
after they have spoken or written a sentence expressing a desire or an
expectation of something happens. The implication is that although the speaker
will probably be working hard to achieve an aim, the ultimate decision as to
whether it fails or succeeds will be God’s.

instalment sale?A financing
arrangement whereby the lender buys the property or machinery, then immediately
sells it back at a higher price, but with the payment being made in
instalments.

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insurance?A form of risk management to
protect owners of property from losses due to unforeseen events which would be
detrimental to the owner. Insurance companies sell insurance policies to
companies, individuals and so on, which have a cost that is calculated using
the value of the asset being insured, the risks to its loss or damage and
various other factors such as remaining competitive with other insurers. Annual
payments will usually be divided by 12 and paid monthly. Almost anything can be
insured against almost any eventuality as long as it is not certain, or
extremely likely, to happen. Should the insured person suffer loss or damage of
the insured asset, as long as the conditions of the contract have not been
breached, the insurer will pay out the agreed amount so that the insured can
replace the lost item. The insured might also have agreed an excess, which is
an amount he or she is willing to pay towards the replacement of the asset, the
remainder being made up by the insurer. Higher excesses generally lead to lower
premiums, and might have a psychological effect of making the insured person
act less riskily with the asset and less likely to make a small claim (for
example, for a small dent on a car). Insured persons who do not make claims for
some years can build up a ‘no claims bonus’ which is a reflection of how
careful and trustworthy they are for insurance purposes. This can lead to lower
premiums.

Insurance is a hot topic in Islam for
various reasons. First, insurance companies must be Shariah-compliant, and any investments
they make must also adhere to Islamic law (that is, they must not invest in haram products and
activities pork, alcohol, arms or the pornography industry). Second, risk is a
thorny subject in Islam, and a company must not be seen to be profiting from
risk, and certainly not from the misfortunes of others. And third, Muslims
believe that they should look after each other and the wider community, so
insurance should not be necessary; those suffering misfortune should be helped
out by their friends, families, neighbours, community and nation, as well as
the rest of the world when required. It should not be necessary to pay into a
fund just in case something happens, but people should react when it does. That
said, an Islamic insurance industry has indeed sprung up, based on the Takaful concept, which has echoes of
western mutual insurance but has passed the scrutiny and analysis of countless
Islamic scholars for its Shariah compliance.