Question Summary:
Conventional health and medical insurance schemes are not permissible according to Shariah

Question Detail:

My husbands company provides us with health insurance and myhusband and two of my children suffer from diabetes so every month we get theprescription for their medicine and the doctor prescribes alot so there is alot of them at our house so every month we go to a nearby pharmacy andexchange the leftover medicine with the stuff that we need in our house liketoiletries and shampoo and other stuff my question is that is this right? andcan i exchange the extra medicine for money? please guide me as soon aspossible

Answer :

In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh
Conventional health and medical insurance schemes are not permissible according to Shariah. However, if a person is in the employ of a company and a certain amount of money is deducted from his/her salary every month for medical and health insurance, then it is permissible for one to use the benefits of the medical aid scheme as that will be considered as a gift from the side of the company. One will not be held responsible for taking out the conventional health insurance policy. 
 
With regards to your specific question, you state that you exchange goods for the extra medication prescribed by the doctor under the medical health insurance. In principle, the medication prescribed by the doctor is a gift (Hibah) to you and your family. You are now the legal and complete owner of the medication. Therefore it is permissible for you to exchange the medication for other goods and items. Nevertheless it is impermissible for one to deliberately seek extra benefits from the medical health insurance scheme without any dire need and necessity as that contravenes the ethics and values of Islam and constitutes fraudulent and unlawful practice according to the terms and policies of the medical and health insurance scheme.
 
And Allah Ta’āla Knows Best
 
Ismail Desai,
Darul Iftaa
Checked and Approved,
Mufti Ebrahim Desai.