One of my friend insists on getting insured by an insurance co. This insurance company is dealing with government on credit (Sood) interest. Give me the legality in Islam of this policy. He is saying that the company is investing this money in real estate. What does Islam say?

Praise be to Allah, the Lord of the Worlds; and blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.
If you can avoid having an insurance policy, no doubt it is better for your religion, farther from being involved in doubts, and more appropriate to trust in Allah and to be near to Him. If you have no choice, then it is compulsory on you to get insured only in a company that applies the Islamic rules in its policies. If you can not find such a company and you can not avoid being insured, in this case you may be insured by any commercial company provided the insurance is restricted only to the extent of necessity. Allah knows best.