Dear Mufti Sahab,
My wife is studying in the US and as per the legal / government requirements, she is required to have insurance. The cheapest form of insurance that is available to her is student insurance.
Under the student insurance, there are two types available:
- Basic insurance
- Enhanced insurance
Under the basic insurance, she will have to pay 50% of the medical expenses (50% will be paid by the insurance company) and under the enhanced insurance, she will have to pay only 20% of the medical expenses (80% will be covered by the insurance company).
The difference for the monthly premium or the monthly installment between the basic and enhanced insurance is very nominal i.e. enhanced insurance will cost only USD 60 extra per month.
My questions are as following:
1) In her situation, is it allowed for her to take insurance since it is something that is required by the legal requirements.
2) Can she take the enhanced insurance (since the cost towards it is nominal and the benefits are much greater) or she is only allowed to take the basic insurance.
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
It is clear from your query that you understand that conventional insurance is prohibited and that one may be excused if it is required by law to take out insurance.
The legal requirement will be fulfilled through taking out basic insurance.
Accordingly, if not mandatory, it is not permissible to take out enhanced insurance.
And Allah Ta’āla Knows Best
Mufti Arshad Ali
Darul Iftaa, Jaamia Madinatul Uloom (Trinidad)
 فتاوى محمودية، ج16 ص387،ادارة الفاروق كراشي
Contemporary Fatawaa – Mufti Muhammad Taqi Usmani (pg 187)