Insurance sector in the
UAE gets prepared to start the new stage by the beginning of January 2017. The
sector witnesses a huge leap through the year 2016, in line with the national
economic growth, as the written premiums reached about AED 40 billion.
Reports and specialized
studies suggest that the future of the insurance sector will witness a
substantial leap coping with the continuous growth of the national economy.
These studies are based on the positive indications achieved by the insurance
sector in the different fields and the increasing demand for the insurance
products in the local market, in addition to the increasing expenditure on
development projects, economic plans and events that will be hosted by the
country through the next period.
programs and projects owned by the Insurance Authority and the positive growth
indications of the national economy assure that the insurance sector will start
a new stage of booming businesses. In this framework, it is expected that
written premiums in insurance sector will reach about AED 60 billion by 2020
with an annual growth rate of 10%.
The huge funds invested
in this sector refer to the vital role that insurance plays in the national
economy, as investments have reached AED 45.7 billion in 2015, while
shareholders’ equities in national insurance companies have reached AED 17.5
The Insurance Authority
has launched the third version ( Version 1.1) of financial e-Forms that
represent the monitoring tool through which a comprehensive financial database
of the insurance sector in the country will be built and financial and
technical indications will be provided according to the risk-based
Over the last few
months, the Insurance Authority made remarkable achievements and outcomes
through developing the laws and regulations that organize the insurance market
in the UAE in accordance with the best international systems and standards and
taking the services offered to insurance policy Holders and the insurance
business sector to the highest level.
In this context, the
Authority has launched a unified regulation for insurance policies, that includes
a unified regulation for vehicle insurance policies against civil liability and
against loss and damage. The new regulation is considered an important
milestone in the development of organizational and technical rules for boosting
performance of the UAE insurance market, vehicle insurance, and the protection
of the policyholders’ rights as this regulation includes provisions that are poised
to enhance competitiveness of the UAE economy and to keep pace with the
international best practices prevailing in the insurance industry all over the
The Regulation that
includes many benefits for policy holders and local market – which were absent
in the previous two standard vehicle insurance policies – aims at protecting
the policyholders’ rights as well as the shareholders in insurance companies
and protecting the insurance companies themselves from any risk they may face
in the future, thus participating in developing technical bases and rules
necessary to promote the establishment of modern and sophisticated regulatory
bases for the insurance market of UAE in accordance with best international
practices. It further enables the insurance sector to increase its contribution
to GDP and support the growth in the national economy in all fields, in accordance
with sound and strong grounds
Moreover, the Board of
Directors of the Insurance Authority (IA) have issued, this December, vehicle
Insurance Rates Regulation based on the unified regulation for vehicle
insurance policies issued last September.
The regulation includes
the rates of one vehicle insurance policy against civil liability and rates of
two vehicle insurance policies against loss and damage and against civil
liability, as these models attached to this regulation are considered
inseparable part of this regulation. Insurance companies are committed to apply the rates based on vehicle
insurance policies that will be issued as per the first of January 2017 which
represent the date of enforcing this regulation.
The Insurance Authority
currently works on amending the Federal Law No (6) of 2007, concerning the
establishment of the Insurance Authority and regulation of insurance business.
It also includes some procedures aimed at accelerating the processing of the suspended files in the courts and insurance
companies, promoting the process of compensation payment, as well as supporting
the role of conflict resolution through reconciliation instead of heading to
courts. The amendment project also includes some measures and incentives to
encourage all kinds of life insurance and insurance of persons, which play an
essential role in establishing log-term saving and consequently investment.
The Authority also issues rules that
regulate the dealings between insurance companies and banks through the
propagation of insurance policies and issuing the Actuarial Systems project and
insurance producer instructions project.
Emiratization in insurance sector is one of the strategic objectives of
the Authority and comes atop of its priorities. The Authority continues its
efforts in taking more practical procedures to increase Emiratization in
insurance sector, enhance the level of skills and experiences of the national
employess and increase their numbers in insurance sector.