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Fatwa CenterZakat on life insurance
Question
I want to know details about Zakaat on life insurance policy amount.
Answer
All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad 
is His slave and Messenger.
Life insurance is forbidden, and we have previously issued Fatwa 81441 on this matter. Whoever is involved in it has to immediately repent to Allaah and stop his subscription to this insurance.
The insurer and the insured are alike in sin, both have to repent to Allaah.
However, the insured can benefit from the exact amount that he had paid the insurance company and he must get rid of whatever remains from that amount by spending it in charitable fields. Whoever receives from the insurance exactly what he had paid, he has to pay Zakat on it after repenting to Allaah and provided it reaches the minimum amount liable for Zakat by itself or with the addition of other money or other tradable items he possesses when a whole lunar year elapses.
The minimum amount liable for Zakat is what is equivalent to 85 grams of gold, in which case he has to pay from it 2.5%.
For more benefit regarding the ruling about insurance and its kinds, please refer to Fatwa 81425.
Allaah Knows best.
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