Wa `alaykum as-salamu wa rahmatullahi wa barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
1- Finances are the vital base of life without which life cannot continue.
2- Islam gives due care to financial matters stating numerous rulings concerning earning and spending money.
3- Islam encourages work and investing money to achieve economic prosperity for both the individual and the state.
4- It was narrated that the Prophet (peace and blessings be upon him) said to Sa`d Ibn Abi-Waqqas when he asked for a permission to give a half of his wealth as charity, as he had only one girl as an heir, “…It is better to leave your heirs rich than leaving them dependent, begging people for alms…” (Al-Bukhari)
5- Every Muslim bread earner is highly encouraged to secure the financial future of his/her dependents, on the condition that he/she does this via lawful (halal) means.
Regarding your question, Prof. Dr. Monzer Kahf, Professor of Islamic Finance and Economics at Qatar Faculty of Islamic Studies, states:
Sukuk have nothing to do with your question. The issue of insurance is a serious matter.
It is necessary to notice that, all over the world and in many Muslim minority countries, insurance of businesses, homes, jobs, cars, health may be either a factual necessity or very close to it.
We have two views on insurance; one is completely negative to it but the
other argues that it is permissible provided avoiding interest and the
object of insurance is permissible. We, of course, can take this view whenever solidarity (takaful) is not available and we feel that we need insurance.
In the market, there are several insurance contracts that are not based
on interest. This is apparent in home, job, health and other object
As for life insurance, the word life is a misnomer, as it gives the impression of guaranteeing life which is impossible. All it does is giving certain amount of money upon the death of the insured person.
There are other contracts that are not based on interest such as term life insurance and variable equity insurance both of which may be taken according to this second view of very respected scholars.
Allah Almighty knows best.