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Insurance for Expats in the United Arab Emirates

Submitted: December 2013

Do not wait for problems to arise before reviewing your insurance arrangements. Once you have a problem, it is already too late. Being poorly insured is risky whereas being over-insured is expensive. Generally, you need insurance to reduce risks, such as the risk of facing ultra-high bills. There is no need to involve an insurer for your ordinary bills, as self-insurance and sound financial planning would be enough here. As the UAE has no tax system, there are no tax incentives to be insured in the UAE.

There is a wide range of insurance products available across the UAE, as the Government strives to build a modern financial system. The market share of foreign-owned insurers has soared over the past five years, and it is now well above that of national insurers. UAE insurers are regulated by the Insurance Authority. Consumers may lodge a complaint to the Insurance Authority if anything wrong happens with the insurer.

According to the official statistics, each $100 in premiums corresponds to $40 to $60 worth of insurance pay-outs. There are some exceptions though: health insurance and car insurance (loss ratio between 60 and 85%) and fire insurance (loss ratio below 50% in a quiet year, rising to above 100% for the “hottest” years).

It is advisable to shop around and compare before taking out an insurance policy. It’s also good to check the financial strength and the reputation of your insurer. If you are unclear about your cover or your needs whilst you are in the UAE, you might wish to check your existing insurance arrangements in your country of origin. This is important if you want to avoid double coverage.

Insurance isn’t necessarily a country-specific issue, but how much insurance you need may vary from one country to another. If you have any doubt, feel free to seek professional advice to determine your actual insurance needs.


Home insurance

Your home insurance needs depend on whether you own your home, or if you rent it.

A buildings policy protects you against damage to your building, and is generally required to secure a mortgage. This may cover the costs of rebuilding your property from scratch or the costs of certain exceptional repairs.

As for all insurance policies, it is up to you to decide how generous you want your cover to be, what the excess amounts are, which unexpected expenses are covered (e.g. alternative accommodation or legal costs), etc.

Contents insurance is much cheaper than homeowner insurance, but it only covers your belongings up to a specified amount. It’s best to have the entire value of your belongings insured. Otherwise, you would likely be treated as partly covered, meaning that you wouldn’t be reimbursed for the entire value of your losses.

Do check if your home insurance policy protects you from third party liability if an accident happens in your home. If you fail to have public liability coverage, you may end up having to pay tens or hundreds of thousands of dollars if an accident takes place in your home.

Going away from home

If you expect to be away from your home for more than one month, you should let your insurer know. Failure to do so may result in a claim being rejected if something happens to your home whilst you are away.


Vehicle insurance

Motor vehicle insurance is mandatory, and your policy must include at least third party cover. This should insure you against potential liabilities for third party injury or car damage, but not damage or theft of your own car. The good news is that third party cover is the least profitable part of the vehicle insurance business in the UAE, which is ultimately good in terms of value for money.

If you need your vehicle to have more than just third party cover, you might wish to take out a comprehensive vehicle insurance policy. Most drivers in Dubai go for a comprehensive cover.


Health insurance

Health insurance is often made mandatory by the immigration rules. Expatriates may take out an international cover from an insurer in their home country. However, a UAE medical insurance policy could well be suitable for it may be much easier to use in the UAE.

International covers tend to be more expensive, but they are straightforward and they can spare you the need to have separate insurance policies (i.e. one in your home country and one in the UAE). Expats who frequently move across borders are more likely to need an international cover to achieve peace of mind.

Health insurance is helpful, but only to the extent that healthcare in the UAE is very expensive.


Life insurance

Life insurance can be particularly helpful if your family is financially very dependent on you, as it may guarantee a lump sum payment to your family if you die. In the event you’re moving to the UAE with your family or your girlfriend, think of how they can bounce back if you’re no longer part of the equation, or if they could leave the UAE at all.

You should also consider life insurance if you run a business that heavily relies on one specific individual, such as a manager or a highly skilled employee, as a life insurance policy would help reduce the risk of losing that valuable person. Needless to say, a risk-free business is easier sold than a high-risk one.

Do assess carefully the burden of retaining a foreign life insurance policy while you are resident in the UAE. Do also check the geographical extent of your existing life insurance policy when you move across borders.


Business insurance

If you run a business in the UAE, you probably need personnel insurance and public liability insurance.

Personnel insurance protects you in case one of your employees has an accident or an illness in connection with his/her employment duties, provided you are held liable under the applicable labour law.

Public liability insurance covers you against certain third party claims against your business. This may also include legal costs.



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