Praise be to Allaah.
insurance is a forbidden kind of contract, and it is haraam in all forms. It
is not permissible for anyone to participate in it unless he is forced to do
so. We have explained the ruling on this in the answer to question no.
that it is haraam to participate in insurance does not mean that it is
haraam to take one's rights from the insurance company if it is required to
pay to someone who has been affected by an accident.
this, there is no reason why one should not take the diyah for one who has
been killed by accident or injured in an accident from whatever entity the
those who are entitled to it have been referred, whether by the killer or
the court, whether it is an insurance company or otherwise, because those
who are entitled to the diyah are people who have a right, and they are not
responsible for the other party’s dealings with the insurance company.
Shaykh Ibn Jibreen about taking compensation from the insurance company and
he replied: That is permissible, because these companies are committed to
bearing costs incurred by the one who is insured with them, and there is no
reason to refrain from doing that so long as they are obliged to pay
compensation. All that the one who caused the accident has to do – in the
case of a death – is offer the expiation for accidental killing, if the
accident was caused by a mistake on his part.