What is the ruling on a benevolent loan if it is stipulated that 1.5% of its value be deducted in exchange for subscribing to a system that exempts the deceased from repaying loan balances?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
Insurance on a loan is permissible if it is a Takaful (cooperative) insurance, regulated by principles. This means it should be based on the intention of donation and cooperation, not exchange, and the company should not profit from this money. Rather, it should be held or invested for the benefit of the subscribers to cover what is necessary upon the death of one of them. However, if it is commercial insurance, participation in it is not permissible.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/181194
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- Ftawy
- Original fatwa ID
- 181194
- Added here
- . This is when the answer was added to El Fatwa, not the fatwa's date.
- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
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- Read the full answer on Ftawy