Is It Permissible to Work in Commission-Based Life Insurance Sales?

Answered by Shaykh Muhammad Carr

Question

I am considering a remote role selling life and supplemental insurance through virtual meetings, with income primarily from commissions and possible renewal payments.

Answer

In the Name of Allah, the Most Merciful and Compassionate.

Thank you for reaching out and seeking clarification on this important matter. It’s commendable that you seek to ensure that your mode of income aligns with Islamic principles.

Selling conventional life insurance, which is typically commercial, is impermissible, irrespective of whether the remuneration is based on a commission or other structure.

Conventional insurance involves transferring risk in exchange for a premium and is Sharia non-compliant. Selling such types of insurance by extension is equally impermissible. Allah says, ‘And do not aid one another is sin and transgression’. [Quran, 5:2]

Conventional insurance is usurious and contains elements of contractual uncertainty (gharar). The Prophet (May Allah bless him and give him peace) prohibited contractually risky transactions. [Muslim]

Usurious transactions, on the other hand, are decisively impermissible in Islam. Allah says,

“O believers! Fear Allah, and give up outstanding interests if you are (true) believers. If you do not, then beware of a war with Allah and His Messenger! But if you repent, you may retain your principal—neither inflicting nor suffering harm.” [Quran, 2:278-279]

Seek your sustenance through lawful means, and it will reach you. The Prophet (May Allah bless him and grant him peace) said,

“Verily, Jibril inspired in my mind that a soul will never die until it finishes its term and consumes its provision. Thus, be graceful in seeking provision, and let not a delay in sustenance compel any one of you to seek it through disobedience. Verily, Allah does not grant what is with Him except through obedience to Him.” [Abu Nu‘aym, al-Hilya]

And Allah knows best.

[Shaykh] Muhammad Carr
Checked and Approved by Shaykh Faraz Rabbani

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Shaykh Muhammad Carr has dedicated his life to studying and transmitting our beautiful deen. His studies have taken him around the globe, where he has benefitted from many luminaries. Under the guidance of his teachers – Shaykh Taha Karan, Shaykh Yaseen Abbas, Shaykh Muadh Ali, and many others – Shaykh Muhammad has grown to appreciate the beauty and benefits of diverse scholarship. He completed his memorization of the Qur’an at Dar al-Ulum Zakariyyah in September 1997 and received an Alimiyya Degree in 2006 from DUAI (Darul Ulum al-Arabiyyah al-Islamiyyah). He is also affiliated with Masjid Auwal in Bo Kaap, Cape Town (the oldest mosque in South Africa), where he serves as a co-imam, and Dar Al-Safa, where he has taught since 2018. As a teacher, he imparts the wisdom of our heritage and tradition by opening the door to students. As an imam, he has the unique opportunity to serve his community in daily life.

In addition to his roles as a teacher and imam, Shaykh Muhammad Carr has contributed significantly to the administrative and advisory aspects of Islamic institutions. Since 2023, he has served as the Administrative Director at The Imam Kurani Institute, contributing to the institution’s growth and development. He continues to pursue traditional Islamic Sciences, possessing a keen interest in Islamic Contract Law and Finance. Shaykh Muhammad has been a Shari‘a Board Member for Islamic Asset Management & Insurance Companies since 2001, aligning financial practices with Islamic principles.