If the Arabic-language loan financed through Murabaha is stolen, does the debt disappear?

In the event of theft of the financed asset, it's crucial to distinguish between the Murabaha debt and the insurance/Takaful coverage for the asset.

Steps

1. Loss of the asset does not automatically erase the debt.

2. Immediately notify the bank and insurance company, and obtain a statement detailing the compensation amount, how it will be used to settle the balance, and any remaining obligations.

Source

• AAOIFI — Sharia Standard 8: Murabahah

• Central Bank of Egypt — Submit a Complaint