Insurance plays an essential role in modern life, offering individuals and businesses financial protection against unexpected risks. In the UAE, the insurance market has grown rapidly over the past two decades, driven by regulatory reforms, economic expansion, and a greater awareness of the need for financial security. For policyholders, understanding their rights is crucial to ensuring they receive the coverage and protection promised under their insurance contracts. Unfortunately, many individuals and businesses only discover gaps in their knowledge when disputes arise with insurers.

This article explores the rights of policyholders in the UAE, the legal framework that governs them, common issues that arise, and how insured parties can best protect themselves.

The Legal Framework for Insurance in the UAE

The UAE has a robust regulatory system for insurance, designed to protect both consumers and the stability of the insurance industry. The primary regulator is the Central Bank of the UAE (CBUAE), which assumed responsibility for insurance supervision in 2020, taking over from the Insurance Authority. The CBUAE oversees the licensing of insurance companies, regulates their activities, and ensures compliance with laws and regulations.

Insurance contracts in the UAE are also guided by the UAE Civil Code (Federal Law No. 5 of 1985), which sets out general principles of contract law and specific provisions for insurance agreements. Together, these laws aim to balance the relationship between insurers and policyholders by outlining rights, obligations, and remedies available in cases of dispute.

Key Policyholder Rights

Policyholders in the UAE are entitled to several rights that safeguard their financial and legal interests. Some of the most important include:

Right to Clear and Transparent Information

Insurers are legally required to provide policyholders with clear, accurate, and detailed information about their policies. This includes coverage limits, exclusions, premiums, deductibles, and claim procedures. Ambiguous or misleading terms can be challenged in court, as insurance law in the UAE favors clear contractual obligations.

Right to Fair Treatment

Insurance companies must treat policyholders fairly, avoiding discriminatory practices or arbitrary refusals. Whether applying for coverage, renewing a policy, or making a claim, policyholders are entitled to equal and unbiased consideration.

Right to Timely Claims Settlement

Delays in processing claims are among the most common causes of disputes between insurers and policyholders. Under UAE regulations, insurers must settle claims within a reasonable timeframe once all required documents are provided. Policyholders can file complaints with the CBUAE if they experience undue delays.

Right to Confidentiality

Policyholders’ personal and financial data must be kept confidential by insurers. Disclosure is only allowed under specific circumstances, such as legal proceedings or regulatory requirements.

Right to Legal Recourse

If a dispute arises, policyholders have the right to seek resolution through multiple avenues. This may involve filing a complaint with the CBUAE, pursuing arbitration if specified in the policy, or taking legal action through the UAE courts.

Common Issues Policyholders Face

Despite the protections in place, disputes still arise frequently in the UAE insurance market. Some of the most common include:

1. Policy Exclusions and Ambiguity – Many disputes stem from unclear exclusions or technical language that limits coverage in ways policyholders did not expect.

2. Non-Disclosure Allegations – Insurers may reject claims by alleging that the policyholder failed to disclose important information during the application process.

3. Delayed or Denied Claims – Insurers may delay claims processing or deny payment based on technical grounds.

4. Premium Disputes – Disagreements can arise over how premiums are calculated, particularly in business or group insurance policies.

5. Underinsurance or Misrepresentation – Policyholders may later find that the coverage amount is insufficient or was misrepresented during policy issuance.

Protecting Your Rights as a Policyholder

Being proactive is the best way for policyholders to protect their rights and avoid disputes. Several steps can help minimize risk:

• Read Policies Carefully: Policyholders should thoroughly review contracts before signing. Legal or professional advice can help clarify confusing terms.

• Disclose All Relevant Information: Failing to disclose medical, financial, or operational details can give insurers grounds to deny claims later.

• Maintain Proper Documentation: Keeping records of payments, communications, and claims can provide crucial evidence if disputes arise.

• Know the Complaints Process: Policyholders should be aware of the steps for filing complaints with insurers and escalating them to the CBUAE if needed.

• Seek Legal Support Early: In cases of complex disputes, involving a lawyer early can prevent matters from escalating and ensure compliance with UAE law.

The Role of Lawyers in Protecting Policyholder Rights

Legal professionals play an important role in supporting policyholders when dealing with insurance matters. Lawyers can:

• Draft or review policy contracts to ensure terms are fair and compliant with the law.

• Advise on disclosure obligations during the application process.

• Represent policyholders in claims disputes with insurers.

• Assist in filing complaints with regulators or pursuing arbitration.

• Advocate for clients in court if litigation becomes necessary.

Having professional legal support is particularly important for businesses, where disputes can involve significant financial exposure and complex policy structures.

Looking Ahead: Policyholder Rights in a Changing Market

As the UAE insurance market continues to evolve, policyholder rights are likely to expand. Regulatory authorities are working on initiatives to strengthen consumer protection, increase transparency, and adopt international best practices. For instance, digital insurance platforms are creating new opportunities but also raising new questions around data protection and claims processing.

Policyholders—whether individuals buying health or motor insurance, or corporations insuring large-scale projects—should remain informed about these changes to fully safeguard their rights.

Conclusion

Understanding policyholder rights in the UAE is crucial for anyone purchasing insurance. While the legal framework provides strong protections, many disputes arise due to unclear terms, non-disclosure, or delays in claims settlement. Policyholders can reduce risks by reading policies carefully, disclosing all relevant information, and keeping thorough documentation. When disputes do occur, they have the right to seek legal remedies through regulatory complaints, arbitration, or the courts.

Ultimately, protecting one’s rights requires both awareness and proactive action. With the right knowledge and, where necessary, professional legal guidance, policyholders can ensure they receive the coverage and financial security their insurance is meant to provide.