It is worth quoting Dr. Mohammad Muslehuddin, M.A., Ph. D.(London) here, who writes in his book “Insurance and Islamic Law” on pages 124, 125 that:

The divergence of opinion is due mainly to the fact that the traditions of the Prophet Mohammad (pbuh) are not clear as to the applicability of Riba is reported to have said:“The Prophet (pbuh)departed from this world and we did not get the question of the Riba clarified”.
The Khalifah Omer’s words can, by no means, be interpreted to have narrowed down the prohibition of Riba, which has been expressly stated by the Prophet Mohammad as applicable to the six commodities. The Khalifah can not violate the explicit terms of the traditions, rather he enjoins upon the believers meticulous observance of these rules of Riba and refrain even from such things which bear resemblance to it. The Khalifah Omer’s says:
“The last to be revealed was the verse concerning Riba and the Prophet Mohammad (pbuh) expired without having made a clear pronouncement on the question of Riba. Therefore, give up Riba and that which resembles it.”
(Musnad Ibn Hanbal, Chapter Bab Al Riba, Vol 2 page 239, Sunan Ibn Maja Kitab Al Tijara Vol 2, page 764,
also quoted by Maulana Maudoodi in the book of “Sood”, page 160).

Further he says:

The objection to Riba in the life insurance, counts for little as it is open to the insured not to accept more than what he has paid. There can be no objection to other dealings of insurance companies and their investment on interest, for one has to take insurance as it is according to its legal form.
This is, in brief, the rejoinder of the Modernists, who, in addition, point to the contract of clientage “Aqd ul Muwalat” in Islam as a parallel to that of liability insurance. It may be recalled that a person may insure himself not only against the risk of incurring death and personal injury, or damage to his property but also against the risk of incurring the liability to the third parties and the contract of clientage is already in existence to serve this purpose. This is the contract which takes place when a stranger whose descent is unknown, says to the other “you are my guardian and liable to pay compensation in case I commit any wrongful act and, in return, shall be entitled to inherit my property if I die. On the acceptance of such an offer both the parties are bound by it. Liability insurance is, thus, permissible in Islam.
Not only this, but there is another example in Bay’bil Wafa (redeemable sale), a new form of contract introduced into Islam as the circumstances demanded it, so the contract of insurance may be also adopted under the rule of ‘necessity’.
Last but not the least is the example set by the Khalifah Omer, who for the sake of public and driven by “necessity” deviated from the punishment set by the Quran by abolishing the grants given to “those whose hearts are to be reconciled”, and in suspending the punishment of thieves in the year of famine.
(Page 147,148)