Abstract:
This concise research addresses the issue of commercial insurance as a contemporary jurisprudential matter, in light of Syria’s urgent need for reconstruction and attracting foreign investment. The research aims to present an approach that combines jurisprudential principles with economic realities, favoring the opinion of those jurists who permit it under certain conditions, while proposing practical mechanisms to purify insurance contracts of Sharia-related concerns within the Syrian context. The research employs a descriptive-analytical methodology and concludes that commercial insurance can be adopted as an interim solution alongside the ambitious move towards Takaful (Islamic insurance), within a civilizational framework that demonstrates Islam’s flexibility and suitability for all times and places.
Introduction:
The issue of commercial insurance represents one of the most prominent emerging jurisprudential issues that has occupied researchers and jurists in the modern era. It is not a matter whose ruling is definitively established, but rather a fertile ground for sound ijtihad (independent reasoning) based on the principles of Sharia and its overarching objectives. With Syria’s new opening to global investments after decades of revolution and conflict, and the need to provide an attractive legal environment for major companies, it becomes crucial to present this issue within its precise jurisprudential context and offer a practical approach that avoids absolute and preconceived judgments. This approach should establish a vibrant and forward-looking Islamic economic vision, consistent with the principles of civilizational revival.
First, the economic necessity of insurance during Syria’s reconstruction phase:
Insurance, in its various forms, is a fundamental pillar of any modern economy, providing a comprehensive safety net for investors, business owners, and workers alike. Rebuilding Syria after years of conflict requires massive investments. The World Bank, in a report published in October 2025 entitled “Assessing Physical Damage and Reconstruction in Syria (2011-2024),” estimated the cost to be between US$140 billion and US$345 billion, with a conservative estimate of US$216 billion, based on an analysis of damage to infrastructure, housing, and productive sectors for the period 2011–2024(a).
Therefore, attracting such massive investments remains difficult without a sound and legally acceptable insurance system that protects investors from potential risks and safeguards their assets and investments. Furthermore, addressing the high rates of poverty and unemployment plaguing the Syrian economy is a pressing priority. In August 2025, the Syrian Minister of Economy and Industry, Nidal al-Shaar, announced that unemployment in the country exceeded 60%, emphasizing that the scale of the disaster surpassed estimates and that the Syria inherited by the new government was “completely devastated.” This necessitates an influx of capital and a boost to investor confidence, which is inextricably linked to the availability of a safe and secure environment.
In its press release issued in November 2025, at the conclusion of its mission to Damascus, the International Monetary Fund indicated that the Syrian economy was beginning to show signs of recovery and improved prospects. The report attributed this improvement to a rebound in consumer and investor confidence, gradual integration into the regional economy with the easing of sanctions restrictions and the return of refugees, as well as the authorities’ adoption of strict fiscal and monetary policies to maintain stability. The Fund also stressed the importance of developing the infrastructure and institutions of the financial and public finance sectors, emphasizing its commitment to providing an intensive technical assistance program that includes improving national statistics and building the capacities of the central bank and the Ministry of Finance as essential steps to rehabilitate the economy.
Third, the Ruling on Commercial Insurance in Contemporary Islamic Jurisprudence (Presentation and Analysis):
Contemporary jurists have recognized the economic importance of commercial insurance and have differed significantly in their rulings on it. Their opinions are divided into two main views:
A. The view of the majority of scholars and Islamic jurisprudence councils:
This view prohibits commercial insurance because, in their estimation, it involves uncertainty (gharar), usury (riba), and gambling. Among the most prominent of these councils are:
- The International Islamic Fiqh Academy (affiliated with the Organization of Islamic Cooperation): It issued Resolution No. 9 (2/9) in its second session held in Jeddah from 10 to 16 Rabi’ al-Thani 1406 AH (December 22-28, 1985 CE). The resolution states that “the fixed-premium commercial insurance contract used by commercial insurance companies is a contract containing significant uncertainty (gharar) that invalidates the contract. Therefore, it is prohibited according to Islamic law.”
- (Dh) The Council of Senior Scholars in the Kingdom of Saudi Arabia issued Resolution No. 51, dated 4/4/1397 AH (corresponding to 1977 CE). The resolution, after the Council reviewed a report prepared by a group of experts, stipulated the permissibility of cooperative insurance and its suitability as a substitute for commercial insurance, while acknowledging that commercial insurance is not free from risk, uncertainty, and gambling.
They proposed a legitimate alternative, calling it “cooperative insurance” or “takaful,” a formula based on donation and solidarity, and free from the aforementioned concerns. The International Islamic Fiqh Academy, in its subsequent resolutions (such as Resolution No. 149/16/7 concerning health insurance), affirmed that cooperative or takaful insurance is permissible if it adheres to the Sharia principles established by the Academy in its Resolution No. 9(2/9)(g).
B. The view of a group of prominent individual jurists:
Those who permitted commercial insurance under certain conditions, based on the fundamental principles and objectives of Sharia. Among the most prominent of these scholars are:
Dr. Mustafa al-Zarqa (may God have mercy on him): In his book “The Insurance Contract and the Position of Islamic Law Regarding It” (2nd edition, 1984), he considered commercial insurance to be a new contract permissible under Islamic law in itself, by analogy to contracts of commission and guarantee for a fee (S).
Sheikh Ali al-Khafif (may God have mercy on him): In his research “Insurance and Its Ruling According to the Methodology of Islamic Law” (1959), he permitted all types of insurance as long as they were free from the categorically prohibited practice of usury, and he considered the uncertainty involved to be minor and forgivable due to necessity (Sh).
Sheikh Abdullah bin Zaid Al Mahmoud (may God have mercy on him): In his book “The Rulings of Insurance Contracts and Their Place in Islamic Law” (1969), he differentiated between types of insurance, permitting most forms of commercial insurance (such as land, sea, and fire insurance) and excluding life insurance (S).
Dr. Nasr Farid Wasel (former Grand Mufti of Egypt): He issued a fatwa permitting most forms of modern commercial insurance, subject to certain conditions, including that the insurance cover property, not lives, and that its funds not be invested in usurious transactions (D).
The evidence and conditions of those who permit it:
Those who permit it base their opinion on sound foundations, including: the principle in contracts is permissibility, and there is no definitive legal text that specifically prohibits insurance; its analogy to contracts of commission, suretyship for a fee, and guarantee in exchange for a commission, which are permissible contracts in Islamic law; fulfilling a pressing need and achieving the public interest in light of the complexity of modern economic risks; and considering insurance as a new, independent contract that does not fall under the category of inherently prohibited exchange contracts (S).
They stipulated strict conditions to ensure that its permissibility remains within its legal framework (Sh, S, D):
- The contract must be free from prohibited usury, meaning that the insurance company must not invest the policyholders’ premiums in usurious loans, which are definitively prohibited.
- The insurance must not be life insurance (due to its inherent uncertainty and the suspicion of gambling in the view of some).
- The contracting party’s intention must be to protect themselves or their property, not to engage in speculation or risk-taking.
- The contract must be free of conditions that violate the laws of inheritance or wills.
It is worth noting that all these scholars agree that the purest alternative, and the one most in line with the spirit of Islamic law, is the cooperative takaful insurance model, as it fully conforms to the principles of solidarity and mutual support that represent the essence of Islamic economics (D, R). Permissibility here—according to those who permit it—is contingent upon necessity and the absence of an effective takaful alternative in the market.
Fourth, Insurance in the New Syria – Between Practical Application and Sharia Controls:
Syria today faces a significant challenge in attracting the foreign direct investment it desperately needs for reconstruction and achieving sustainable development. International companies will not invest in an environment lacking a comprehensive and reliable insurance system. Capital protection and efficient risk distribution are fundamental to an attractive business climate (A, T).
A. Gradual Implementation:
The new Syria can adopt a gradual model based on:
- First Phase (Short Transition): Allowing commercial insurance according to the aforementioned regulations, while establishing a Sharia supervisory board to oversee the application of the conditions of being free from usury and to regulate life insurance contracts.
- Phase Two (Medium): Establishing national Islamic Takaful insurance companies in partnership with international expertise from Malaysia, the UAE, and Bahrain. The global Takaful market reached approximately US$39.6 billion in 2025 and is projected to reach US$78.28 billion by 2034, representing a compound annual growth rate (CAGR) of 7.87%. Other estimates place the market at US$36.5 billion in 2025, with projections indicating growth to US$63.62 billion by 2030, representing a CAGR of 11.7%.
- Phase Three (Long): Transforming the entire insurance sector towards the cooperative Takaful model, while retaining the option to contract with foreign commercial insurance companies in cross-border cases (reinsurance, joint ventures).
B. Practical Mechanisms for Controlling Usury:
To ensure that commercial insurance contracts are free from usury in the Syrian banking environment (which will undergo restructuring after the lifting of sanctions), the following measures can be taken:
- Requiring insurance companies to open Sharia-compliant investment accounts with Islamic banks.
- Prohibiting the investment of insurance premiums in interest-bearing debt instruments (such as treasury bills and conventional bonds), and directing them towards Mudarabah, Musharakah, and Murabaha contracts for machinery and equipment.
- Imposing financial and administrative penalties on violators, along with publishing annual reports on the extent of companies’ compliance with Sharia principles.
C. Expected Challenges:
- Weak public awareness of the true nature of the jurisprudential differences, with some believing that all commercial insurance is absolutely prohibited.
- The absence of clear regulatory laws for Takaful (Islamic insurance) in Syria, as there is currently no specific legislation for it.
- The difficulty of monitoring insurance companies’ investments given the current weakness of regulatory institutions.
Recommendations for policymakers:
Issue a temporary law to regulate insurance operations, drawing upon the guidelines of the scholars who permit it (S, Sh, S, D), and establish an independent Sharia board to oversee the sector and protect it from religious criticism.
Benefiting from the experiences of successful Arab countries such as Jordan (Jordanian Islamic Insurance Company) and the UAE (Dar Al Takaful – Wataniya International Holding currently).
Conducting awareness workshops for judges and businesspeople to explain the jurisprudential differences and the state of necessity that permits temporarily adopting the opinion of those who permit it, while emphasizing that Takaful insurance is the ultimate goal and the most compatible with the provisions of Sharia (Dh, R).
Including a course on Takaful insurance in the curricula of financial and banking institutes.
Conclusion:
In conclusion, the issue of insurance remains open to interpretation, and Islamic jurisprudence accommodates differing opinions. The Sharia ruling varies according to time, place, custom, and public interest (S, Sh). Given the pressing need for the massive investments awaiting Syria, and within the framework of envisioning a bright future befitting the civilization of the Euphrates Valley, adopting the opinion permitting commercial insurance represents a key to the desired economic revival, along with the ambitious move towards completing the Islamic insurance infrastructure through cooperative Takaful companies (A, T, J, H). (T).
The Syrian Future Movement believes that this approach does not represent a compromise of religion, but rather a civilizational endeavor demonstrating that Islam is a religion of ease and flexibility, capable of accommodating the demands of modern life and adapting them to serve humanity and society. What I have mentioned briefly is a jurisprudential and economic approach for study and discussion. I ask God to make it beneficial, and God is the One who guides to the straight path.
the reviewer:
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