Are insurance policies (life insurance and property insurance) permissible in Islam?

Whether insurance is permissible or not depends on the detailed contract arrangements. There is no principle objection to insurance where a group of people agree to make regular contributions in order to cover against the cost of a misfortune afflicting any one of them, for example automobile clubs offering road rescue services operate this kind of insurance. On the other hand, where insurance contracts involve speculation on the stock exchange and dealing in futures, as many life insurances for example do, they become a form of gambling and become prohibited. The current uncertainty in the UK about pension schemes and endowment policies shows the danger of this kind of speculation.