Insurance Law in Dubai Mainland: Complete Guide
An onshore Dubai insurance operation needs a federal permission alongside its emirate trade licence, and the same division between local and federal rules runs through the policy that follows.
A Dubai trade licence and the permission to carry on insurance business come from different authorities: the Department of Economy and Tourism licenses the company, while underwriting, broking and intermediation are federal, supervised by the Central Bank. The guide separates the activity permissions, shows why an onshore licence does not reach into the DIFC, and covers what decides claims later.
The licence you need is not issued in Dubai
A recurring surprise for businesses setting up an insurance operation in Dubai is that the trade licence and the insurance permission come from different places. The Department of Economy and Tourism licenses the company to trade from a Dubai address. The permission to underwrite, broker or intermediate insurance is federal, and supervision sits with the Central Bank of the UAE. Holding the first without the second is not a technicality that gets tidied up later; it is the reason an application stalls or an operation is stopped.
The activities are licensed separately, too. Carrying risk, placing risk as a broker, acting as the agent of a named insurer, administering claims for another party and providing actuarial services are distinct permissions. Establish which one describes what you actually intend to do, and check that the entity doing it holds that permission, before you commit to premises or hire a sales team.
Dubai mainland is not the DIFC
The Dubai International Financial Centre sits inside the emirate but operates as a separate common-law jurisdiction with its own courts and its own regulator, the DFSA. Abu Dhabi Global Market is the same arrangement under the FSRA. An insurer or broker authorised in one of those centres is authorised for what that regulator allows, and an onshore Dubai licence does not extend into them. Groups that run both need to be disciplined about which entity signs which contract, because a policy issued by the wrong entity is a licensing problem as well as a contractual one.
The choice also decides the courtroom. An onshore Dubai policy with no arbitration clause goes to the Dubai Courts, which work in Arabic and rely heavily on court-appointed experts in insurance cases. That is a workable route, but it should be chosen rather than inherited from a template.
The company behind the licence
The operating entity is constituted under the Commercial Companies Law, Federal Decree-Law No. 32 of 2021, which replaced Federal Law No. 2 of 2015. That governs how the company is formed, how managers are appointed and what duties fall on the people running it. Regulators approve named individuals for compliance and reporting roles, so the constitutional documents, the internal delegations and the individuals notified to the authority all need to say the same thing.
On ownership, Federal Decree-Law No. 26 of 2020, effective 1 June 2021, removed the general 51% UAE-national ownership requirement for mainland companies, and full foreign ownership is available for most mainland activities, subject to a list of activities with strategic impact. A branch of a foreign company is a different arrangement and still uses a local service agent. Confirm how your particular insurance activity is treated before you fix the shareholding.
Insurance a Dubai business has to buy
Separately from anyone selling insurance, employers in Dubai carry insurance obligations of their own. Health cover for employees is mandatory in the emirate, and it is enforced at the point of visa processing. Motor insurance is compulsory. Employees also fall within the federal unemployment insurance scheme. Employment obligations more generally sit under Federal Decree-Law No. 33 of 2021, which replaced Federal Law No. 8 of 1980, and include liability for work injuries that a policy may or may not fully answer for. Check what your policy actually covers against what the law makes you liable for; the gap between the two is where employers get caught.
Getting the policy right before the loss
Disclosure at inception
UAE insurance disputes turn on non-disclosure more than on anything else. The proposal form is the record of what the insurer was told, and an insurer that later declines a claim starts there. Answer the questions asked, disclose what is material to the risk even where no question covers it, and keep a file showing what was sent and when. A broker completing the form from memory on the client's behalf is writing the insurer's defence.
Language
Onshore, the Arabic text governs. Commercial policies are commonly issued in English with an Arabic translation attached, and the two do not always match. The Dubai Courts read the Arabic. Have it checked at issue rather than at claim.
Exclusions and conditions
Read the exclusions before the insuring clause. Most declined claims fall inside a written exclusion the insured never focused on, or breach a condition about notification, cooperation or maintaining a stated standard of care. Notification deserves particular attention: notify within the period the policy specifies, in the manner it specifies, and in writing. Late or informal notice gives the insurer an argument that has nothing to do with the merits of the loss.
Naming the insured correctly
Where a group holds assets in one company and trades through another, the schedule has to reflect it. If the named insured does not own the damaged asset, the insurer will say it had no insurable interest. Reconcile the schedule against the corporate structure at every renewal and endorse the policy whenever the structure changes.
When the insurer says no
A refusal letter is a position, not a determination. Ask the insurer to identify the specific term relied on and to hand over the adjuster's or surveyor's report behind the decision. Broadly drafted refusals often narrow considerably once the insurer has to point at a clause.
The federal regime routes policyholder complaints through a dispute committee before the courts, with a route of challenge afterwards within the period the rules specify. The evidence filed at that first stage frames everything after it, so build the file properly the first time. Check the limitation position at the point of refusal rather than after the correspondence has run on: a claim lost to time cannot be recovered by argument.
For reinsurance and larger commercial placements, arbitration clauses are common. Arbitration is governed by Federal Law No. 6 of 2018, amended in 2023. DIAC now administers cases that would previously have gone to DIFC-LCIA, abolished by Dubai Decree No. 34 of 2021, while the DIFC remains available as a seat, and ADCCAC was restructured as arbitrateAD from 2024. Name the institution, the seat and the language. A clause that names none of them turns into a preliminary dispute of its own before anyone reaches the loss, which is an expensive start to financial dispute resolution.
Data, tax and reporting
Claims files hold medical, employment and financial information. Onshore, personal data is governed by Federal Decree-Law No. 45 of 2021, while the DIFC and ADGM apply their own regimes. Set the rules on what is collected, how long it is kept and what may go to a reinsurer, an adjuster or an authority before the files exist.
Corporate tax applies under Federal Decree-Law No. 47 of 2022 for financial years starting on or after 1 June 2023, at 0% up to AED 375,000 of taxable income and 9% above. VAT applies at 5% under Federal Decree-Law No. 8 of 2017 as amended by Federal Decree-Law No. 18 of 2022, and the treatment of premiums, commissions and fees varies by product, so have it assessed. Economic substance reporting was cancelled for financial years ending after 31 December 2022 by Cabinet Decision No. 98 of 2024, though obligations remain for the years from 2019 to 2022 and still come up in due diligence.
For help with a declined claim, a policy or broker agreement review, or licensing an insurance business in Dubai, contact the Nour Attorneys team.
Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal advice. Readers should seek professional legal advice tailored to their specific circumstances before making any decisions or taking any action based on the content of this article.
Nour Attorneys Team
Related Resources
Explore more of our insights on related topics:
- Handling a declined insurance claim in the UAE
- Employer insurance obligations for Dubai businesses
- Broker and agency agreements under UAE law
- Choosing between mainland Dubai and the DIFC for a financial services entity
