Back to search

Is it permissible for a car rental company to insure its cars to protect shareholders' rights, and is it possible to be a shareholder in a car with this company, knowing that the car will be registered in the name of the rental company?

1 min readAlso available in العربية

It is permissible to insure a car if the insurance is Islamic Takaful. As for commercial insurance, it is not permissible except in cases of dire necessity where Takaful insurance is unavailable. The European Council for Fatwa and Research has issued a fatwa permitting commercial insurance for Muslims in Europe when there is an urgent need to avert hardship and difficulty, such as insuring cars and Islamic institutions, and when no Islamic alternative is available. If Takaful insurance that meets the need exists, then it is not permissible to deal with commercial insurance companies. If it does not exist, then it is permissible in cases of recognized need. However, if there is doubt about the recognition of the need, the original ruling remains the prohibition of commercial insurance. In cases where insurance is permissible, it is permissible to buy a car, insure it, and then register it in the name of a leasing company to operate it for a percentage of its income.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

Read the full answer on Ftawy