IA seeks to educate the policyholders and the public in order to promote awareness of the importance of the insurance sector in a manner that would contribute to the development of the economy and protect the community.

Accordingly, the IA welcomes policyholder questions and public inquiries about insurance and the insurance market in the UAE at the following address: contactus@ia.gov.ae , and at phone number: 80042823

Insurance is a process whereby a party called “the Insurer” undertakes to another party called “the Insured”, against a premium payable by the latter, that “the Insurer” shall compensate “the Insured” for the loss that “the Insured” may incur in the case of a risk is realized. 

-      The insurance contract:  It is a contract under which the Insurer commits to pay to the Insured or the named beneficiary a sum of money, income salary or other financial indemnity in the event of an accident or the Insured risk is realized, in return for premiums or any other financial payments to be made by the Insured to the Insurer. 
 -      The policy:  is the insurance document that proves the insurance contract

The premium is an amount of money which the Insured is committed to pay in a single payment or successive payments to the Insurer in return for the latter's commitment to assume liability for the risks insured.   A premium in insurance is a key element and an obligation of the Insured which is incorporated into the contract structure.  It makes the insurance contract commutative.   Furthermore, the premium is as important as the risk; no insurance without risk and no insurance without premium.  The installment is legally the reason for the Insurer's obligation to insure the risk; and technically, Insurers depend on installments to settle disaster claims. 

It is the portion of a loss borne by the Insured when the risk occurs

- Provides peace of mind. 
- Provides economic protection for members of the community. 
- Protects the national economy. 
- Creates financially solvent party capable of tolerating the risk and pay compensation.

1)    Insurance of human lives and fund accumulation operations.   (Life insurance, health insurance, fund accumulation operations)
2)    Property Insurance.   (motor insurance, fire insurance, marine insurance, etc.)
3)    Liability Insurance. (Third Party Liability for vehicles, personal accident insurance, employer liability insurance, insurance of trains, insurance of cash,  etc.)

-  Traditional Insurance:  It is often practiced by public shareholding companies established by shareholders, and therefore they have capital and seek to make a profit for their shareholders.   The insurance premiums they collect are always fixed premiums.   The aggregate assets of the company constitute the guarantee for the rights of policyholders.  - Cooperative Insurance:  It is practiced by mutual insurance associations (or associations of mutual form) whereby the members of the association identify the risks they face and collect contributions (which were variable as per the loss ratio then they became fixed later).  Such associations do not operate for profit and do not have capital (except for associations of the mutual form, which have assets (Fond d'etablissement) and their members act as the insurer and the insured at the same time.   These entities have evolved after they underwrite insurance business for non-members and become a strong competitor to insurance companies. - Takaful (Islamic insurance):  The companies engaged in this type of insurance hybrid entities.  On the one hand, there is a (joint stock) company and there are shareholders who have established the company with the aim of making profit, on the other hand, there are the (participants) Insured who pay contributions to form the (participants’ fund) versus (the shareholders’ fund) .    The participants’ fund is supposed to pay compensation owed ​​to the participants.  In the case of insufficient money in the fund, the shareholders’ fund is supposed to provide a Qard Hasan (i.e. interest-free loan) to the participants’ fund.  The loan will be refunded from the surplus which the participants’ fund may realize in the future.   In the case of a surplus is realized, it should be distributed to the participants or credited to their accounts to pay future contributions.   The relationship between the participants’ and the Takaful company is based either on Wakala or Wakala and Mudaraba together (Wakalah to manage the insurance business) and (Mudaraba to manage investment business for the money accumulated in the participants’ fund). 

The IA issued in 2010 regulations concerning the Takaful Insurance, the issuance of which was an insurance precedence achieved by the UAE at the Arab world level.  The UAE regulation of Takaful is one of the most comprehensive systems at the Islamic level.  The regulations contain some rules designed to regulate the work of Takaful insurance companies and can be summarized as follows: All insurance and investment transactions by the company must be compliant with the provisions of Islamic Sharia.  Risk management operations and investment business shall be conducted by the company on Wakala or Wakala and Mudaraba together.  Family Takaful Insurance and General Insurance may not be combined in one Takaful insurance company.   The existing companies currently engaged in both types were given a specific deadline to adjust their positions.  The membership subscription document is separated from the Takaful policy.  The company (i.e. the shareholders fund) is committed to provide a Qard Hasan (i.e. interest-free loan) to the participants’ fund in case of a deficit in the assets of this fund. The maximum amount of Qard Hasan is the sum of shareholders' equity. The amount of Wakala fees and how it is calculated, as well as the company's share of Mudaraba, must be stated in advance.  A Shariah Supervisory Committee must be formed in each Takaful insurance company.  The Supreme Committee for Fatwa and Shariah Oversight was formed within the IA.  It is necessary to appoint a Shariah Controller within each company.  The participants may be invited to attend the meetings of the general assembly of shareholders and they have the right to debate even if they do not have the right to vote

It is the process whereby an insurance company would bear all or part of the risk that has already borne by another company, in exchange for a premium paid by the company that originally borne the risk; and it is called the reinsurance premium.  It should be noted that the legal rights of the Insured are not affected by the re-insurance and the insurer who issued the insurance contract shall remain liable before the Insured for all the benefits that arise under the insurance contract.

According to the regulations in effect on the minimum capital of insurance companies, the minimum capital for an insurance company operating in the UAE is AED 100 million.  However, the capital of a reinsurance company operating in the UAE must be AED (250) million.

All insurance companies operating in the UAE, both national and foreign, must adhere to the minimum capital of AED 100 million required for insurance companies.   However, the minimum capital for a foreign insurance company will be required from a company licensed to operate within the UAE and not from the branch.



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