Ġarar vs. Jurisprudential Necessity in Commercial Insurance Contracts

This study deals with the effect of ġarar (uncertainty) and jurisprudential necessity on the Sharīʿah permissibility of commercial insurance contracts, using an analytical and critical approach. The study clarifies the meaning of ġarar, and its effect on contracts, by verifying the effective cause of ġarar, determining its degree, and ascertaining the rationale for its prohibition. The criterion for differentiating between trivial and substantial ġarar is discussed, as well as the views of jurists who permit insurance contracts through a holistic view approach, contrary to the traditional view. The study distinguishes between ḥāǧah (necessity) in the jurisprudential sense, general necessity as expressed in the objectives of the lawgiver, from the concept of ḍarūrah (essentiality). Furthermore, the study highlights an important jurisprudential rule that has direct effect on the permissibility of insurance contracts, i.e., ‘what is forbidden for the prevention of the means (of corruption) is permitted for the preponderant interest’.