Major Overhaul in UAE Insurance Sector: New Regulations Effective from February 15

The United Arab Emirates is set to implement significant reforms in its insurance sector, aimed at enhancing transparency, efficiency, and accountability. Starting February 15, insurance customers will be required to pay premiums directly to insurance companies, rather than through brokers.

Under the new regulations issued by the Central Bank of the UAE (CBUAE), insurance brokers—who were previously allowed to collect premiums for general insurance policies (excluding life, marine, and health insurance)—will no longer be permitted to do so. Moving forward, insurance companies will directly manage premium collections and claim payments, ensuring immediate fund transfers and minimizing the risk of delays and mismanagement.

Additionally, the new policy mandates that insurance companies must settle commissions with brokers within ten days of a transaction. This measure is designed to improve operational efficiency and promote financial transparency across the industry.

The regulations also prohibit brokers from offering discounts by cutting their commission rates, fostering a more professional and value-driven competitive environment based on service quality rather than price slashing.

Further reforms include tighter supervision of brokerage activities to ensure that core functions remain under the control of licensed entities. The new framework strengthens accountability, data protection, and service standards. Both local and international brokerage firms operating in the UAE are now required to maintain minimum capital thresholds and establish secure data backup systems, further improving corporate governance and risk management practices.

These sweeping changes mark a pivotal shift in how the UAE’s insurance sector operates, aligning it more closely with international best practices and safeguarding consumer interests.