United Arab Emirates: Developments In The UAE Insurance Law And Regulations: Formation Of Insurance Dispute Resolution Committees

Last Updated: 3 September 2019
Article by Peter Ellingham and Rishi Sengupta

Over the past two years, there have been various developments in the laws and regulations for insurance in the United Arab Emirates ("UAE"). Most recently, the UAE Insurance Authority ("IA") issued a regulation (following a change in UAE law) that formed specialist committees for the resolution and settlement of insurance disputes.

In this note, we briefly set out the position taking into account the various applicable regulations, our experience on some recent cases and the potential impact on reinsurance.

In summary, this note highlights that:

  1. On 15 July 2019, the UAE IA issued Resolution No (33) of 2019 forming specialist three-member IA Committees that would be the first layer in the resolution of disputes between UAE licenced insurers and insureds and/or beneficiaries of a UAE insurance policy;
  2. The IA Committees Regulation provides tight deadlines for Insurers;
  3. The IA Committees have wide discretion on procedure, including summoning parties to meetings and appointing their own experts;
  4. The IA Committees Regulation also allows third party claimants who may be entitled to cover under a policy to also claim directly against the Insurer, including commencing proceedings before the IA Committees against the Insurer;
  5. Reinsurance contracts are not mentioned but might be included;
  6. The IA Committees however do not have jurisdiction if there is a valid arbitration agreement. A "valid" arbitration agreement for insurance and reinsurance contracts should be: (i) in writing; (ii) outside the terms of the insurance policy; and (iii) agreed by authorised persons within the respective parties; and
  7. A way around for reinsurance contracts could be to make them subject to the jurisdiction of the DIFC Courts.

The New Insurance Law

  1. On 1 May 2018, UAE Federal Law No (3) of 2018 "on the Amendment of certain Provisions of Federal Law No. (6) of 2007 Concerning the Establishment of the Insurance Authority & Organization of its Operations" came into force (the "New Insurance Law"). Article 110 of the New Insurance Law: (i) sets out a broad requirement by which insurers are required to handle claims; and (ii) empowers the UAE IA to form specialised dispute resolution committees (the "IA Committees") to handle insurance disputes.

Insurer's requirements in handling claims

  1. Under the New Insurance Law, "Insurers" (i.e. insurance companies incorporated and licensed in the UAE or international insurers licensed as insurers in the UAE through a branch or an insurance agent) are required to handle claims in accordance with the applicable law, policy provisions, and in line with the following process/procedures:

    1. Issuing a decision concerning any insurance claim in accordance with professional rules and codes of conduct and ethics; and
    2. Clarifying any declinature of all or a part of a claim with reasons in writing.
  2. For 2(a) above, we can take guidance from the UAE IA's Board Resolution No (3) of 2010 that contains "Instructions concerning the code of conduct and ethics to be observed by Insurance companies Operating in the UAE" (the "2010 Regulations"). There are three points of note:

    1. Per Article 3.8 of the 2010 Regulations, Insurers should only deal with insurance consultants and loss adjusters licensed by the UAE IA;
    2. Per Article 9.1, an Insurer should set a mechanism for processing claims, including (i) having claim forms in clear language, per the type of insurance business; (ii) detailing the documents that should be submitted for consideration of the claim; and (iii) specifying "reasonable time" for provision of the document and settlement of the admitted claims; and
    3. Per Article 9.4, Insurers should "Notify the Insured or Beneficiary when the examination of the claim is completed, whether by approval or disapproval, within 15 days as of the date of receipt of the complete documents." If further time is needed then the insured/beneficiary should be notified of the delay, and provided with reasons for the delay.

IA Committees

  1. Articles 110.2 and 110.3 of the New Insurance Law provide:

    "2. One or more committees that will be concerned with resolving the disputes arising out of insurance contracts, operations and services shall be formed. The committee(s) shall have the competency to request any official papers or documents and to counsel experts, as well as hearing of witnesses and any other alternatives that need to be used to resolve the disputes before them;

    3. Cases resulting from the disputes arising out of insurance contracts, operations and services shall not be accepted, if such disputes are not brought before the committees established in accordance with the provisions of paragraph No. (2) of the article herein."1
  2. Following the New Insurance Law, some Courts of First Instances in the UAE started declining new insurance proceedings, instead referring claimants to the IA Committees. However, as the IA Committees had not been formed, the proceedings eventually continued in the normal Court process in the UAE Courts.

Formation of the Committees

  1. On 15 July 2019, the UAE IA issued "Resolution No (33) of 2019 of the Board of Directors of the Insurance Authority on the Regulations of Insurance Dispute Settlement and Resolution Committees" (the "IA Committees Resolution"). Pursuant to Article 27, the IA Committees Resolution would come into force three months after publication - by 14 October 2019.
  2. Article 3 of the IA Committees Resolution provides for "Permanent Committees" (i.e. more than one) for "Settlement and Resolution of Insurance Disputes" where:

    1. Each IA Committee would consist of a Chairman and two or more members, and an equivalent number of reserves;
    2. The Chairman may be a judge, but all the members (including the Chairman) are appointed by the UAE IA;
    3. The members (including the Chairman) would be subject to the same controls and obligations of a UAE judge;
    4. The term of membership shall be one year but is renewable; and
    5. The IA Committees will hold sessions in Abu Dhabi and Dubai.

IA Committees' Jurisdiction

  1. Per Article 4 of the IA Committees Resolution, IA Committees have jurisdiction to settle and resolve all insurance disputes, across all types of policies, brought by "the Insured, Beneficiaries or all affected parties who have the capacity or interest in the Insurance Dispute against the Company only, irrespective of the value"2. Article 5 of the IA Committees Regulation however says that the IA Committees do not have jurisdiction for:

    1. Summary and provisional proceedings and precautionary attachments;
    2. Insurance disputes commenced prior to the IA Committees Regulation; and
    3. Insurance disputes that are subject to arbitration clauses. (We return to Arbitration later).

Third Party Claims against Liability Insurers

  1. Article 4 of the IA Committees Resolution refers to "Beneficiaries or all affected parties who have the capacity or interest". Kennedys Dubai have handled numerous court cases where third party claimants (i.e. not the insured) have brought proceedings in Court against an Insured and its liability Insurer. Per Article 4, it would mean that such third party claims should then fall under the jurisdiction of the IA Committees.
  2. However, "Insurance Disputes" under the IA Committees Regulations are defined as "Disputes arising from the complaints made by insureds, beneficiaries or affected stakeholders against the [Insurer]" and Article 4 says the IA Committees jurisdiction is for "Insurance Disputes against the Company only". In theory, the IA Committees should not be able to consider third party claims against an insured and its liability Insurer until the third party claimant has established liability against the insured, because otherwise the claim would be against the insured and the Insurer and not just the Insurer.
  3. But, Article 14 of the IA Committees Regulation allows the joinder of "any party who can be litigated upon initiating the Dispute", as a result of which the third party claimant could claim against the insured and its liability Insurer. An issue then arises as to whether the IA Committees could consider a non-insurance contractual or tortious liability claim.
  4. On a general level, we could draw reference from the approach taken by the Committee for Rental Disputes (the "Rental Disputes Committee") formed in Dubai in 2013, following Dubai Decree No (26) of 2013. The Rental Disputes Committee has jurisdiction to consider all disputes arising out of a tenancy agreement. In 2014, Kennedys Dubai were involved on behalf of a landlord's insurer in a claim brought by a tenant against its landlord and the landlord's insurer following damage to the tenanted premises. The Dubai Court of Cassation3, on its own accord, issued a decision saying that the underlying dispute was essentially between landlord and tenant and so should be before the Rental Disputes Committee4. In 2015 Kennedys Dubai were involved in another claim before Dubai Courts brought by a landlord against its tenant and the tenant's liability insurer, relating to damage to the tenanted property following a fire. A jurisdictional challenge was raised, and based on the 2014 Cassation Decision, the Dubai Court of First instance and Dubai Court of Appeal found that the Rental Disputes Committee had jurisdiction. However, when appealed to the Dubai Court of Cassation, the Cassation Court decided that only the Dubai Civil Courts, and not the Rental Disputes Committee, had jurisdiction, as the dispute between the landlord and tenant was a claim in tort, which falls under the jurisdiction of the Dubai Civil Courts5. Since then, all such liability claims have been decided by the Dubai Courts and not the Rental Disputes Committee, and often involve the claimant or the defendant joining the defendants' liability Insurers in the proceedings. It is possible that a similar approach may be applied in respect of the IA Committees but that remains to be seen.
  5. As such, the issue of whether or not the IA Committees hold jurisdiction in third party claims against liability Insurers, when the liability has not been first established against the insured, will develop over time. In our view, and as is the case in other jurisdictions, the claim should first be between the third party and the insured, and then following that, if the Insurer declines cover, and if the insured disagrees, it could commence proceedings against the Insurer.
  6. Hopefully, given the process under the IA Committees Regulation (addressed in the paragraphs that follow), the issue should be clarified soon. There is therefore potential benefit for liability Insurers (and as such its policyholders in general) as they would not need to incur unnecessary additional legal costs in defending themselves in proceedings brought by third party claimants before the insured's legal liability, and the basic requirement for considering that a liability policy responds has first been established.

Process to be followed under the IA Committees Regulation

  1. The New Insurance Law, and the IA Committees Regulation, broadly set out a four step process following the submission of an insurance claim:

    1. Step 1: Insurer handles the claim (see paragraphs 2 and 3 above);
    2. Step 2: Complaint to the UAE IA. If an insured/beneficiary disagrees with the Insurer's decision on a claim or the delay in handling the claim, it could complain to the UAE IA by providing some basic details and the relevant documents. The UAE IA then gives the Insurer 5 business days to provide an explanation;
    3. Step 3: Conciliation by the IA Committees. If the complainant disagrees with the Insurer's explanation in Step 2, it can ask the UAE IA to refer the matter to the IA Committees. The IA Committees can then decide their own procedure, but have 15 business days from the reference to the IA Committees to resolve the dispute in conciliation between the insured/beneficiary and Insurer. The 15 day period can be extended in agreement between the parties or by decision of the IA Committees' Chairman. If there is settlement then that is ratified by the IA Committees, otherwise we move to Step 4.
    4. Step 4: IA Committees' Decision. The IA Committees have discretion on the procedure including requiring attendance, or physical meetings/hearings, and documentation and information requests. But the IA Committees have 20 business days from the date of receiving all documentation and information necessary for determining the dispute to issue a decision. Again, the IA Committees can extend the 20 day period if deemed necessary.
  2. The IA Committees are also permitted to:

    1. Appoint experts registered with the UAE IA for determining factual issues, and assisting on technical matters; and
    2. Taking witness evidence in person or through videoconferencing.

Appeals from IA Committees' Decisions

  1. Decision of the IA Committees can be appealed to a Court of First Instance within 30 days of the notification of the decision. Beyond the 30 day period the decision shall be final and binding. Beyond the Court of First Instance, there are two further Courts of appeal – the Court of Appeal and the Court of Cassation. In effect therefore, the IA Committees have added another layer for insurance disputes. That could carry cost implications for the parties involved.


  1. Arbitration is often used as a preferred means of dispute resolution in the UAE and, as mentioned before, is an exception to the jurisdiction of the IA Committees. But, as in other jurisdictions, parties can only arbitrate by reference to an arbitration agreement. UAE Arbitration Law6 requires that the arbitration agreement must in writing, either in an exchange of correspondence (including electronic correspondence) or as part of a written contract. However, under the UAE law7, Arbitration Agreements contained within insurance contracts are void unless they are "separately agreed" by the parties. In other words, an arbitration clause, simply contained in the body of the policy does not comply with the law and is (strictly) not valid.
  2. In addition, and where the insured is a juristic person, the UAE Arbitration Law requires that the arbitration agreement has to be concluded by someone who is authorised to agree the arbitration. For Public Joint Stock Companies (i.e. publicly traded companies), Article 154 of the UAE Companies law8 says:

    "The Board of Directors shall undertake all powers determined by the company's articles of association in the exception of any powers restricted to the General Assembly by this Law or the company's articles of association. Nevertheless, it shall not be permissible for the Board of Directors to conclude loans for terms of more than three years, .... and make agreement on arbitration unless such actions are permitted by the company's articles of association or if they, by nature, fall under the purposes of the company. In other than foregoing two cases, such actions require the issuance of a special resolution by the General Assembly to be concluded."
  3. For Limited Liability Companies (LLC) however it is understood that the general manager named on the trade licence (usually the CEO) has inherent power to agree arbitration, unless restricted in the Company's articles or by special agreement.
  4. Therefore, to be able to arbitrate an insurance dispute, there has to be a special agreement, outside the terms of the insurance policy, agreed by authorised personnel of both the Insurer and insured.

Reinsurance Disputes

  1. Reinsurers will remain interested in the process of disputes for a cedant. But what about disputes between a reinsurer and its cedant?
  2. Until recently, there was no specific reinsurance law in UAE. It was understood that the insurance law would apply to reinsurance contracts. In May 2019, the UAE IA issued "Board of Directors Decision No 23 of 2019, Concerning Instructions Organising Reinsurance Operations" (the "Reinsurance Regulations"). Article 42 of the Reinsurance Regulations says:

    "All the provisions of the legislation governing the direct insurance business shall be applied to the reinsurance companies as far as they are consistent with the nature of the reinsurance business, including the Financial Instructions of the Insurance Companies and the Financial Instructions of the Takaful Insurance Companies."
  3. However, the Reinsurance Regulations apply to "Accepted Reinsurance business by a licensed insurance company registered with the Authority". The licencing and registration of reinsurers in the UAE is still under process and the application of the Reinsurance Regulations remains to be seen.
  4. That said, there is still an understanding that reinsurance contracts are subject to the same insurance laws. Whilst the IA Committees Regulation is geared towards policies issued by UAE licenced Insurers, there is always a possibility that a reinsurance agreement, subject to UAE law and jurisdiction, would also be subject to the jurisdiction of the IA Committees.
  5. Equally, the same validity requirements (as highlighted in paragraphs 18 to 21 above) would apply for any arbitration agreements contained within reinsurance contracts that are subject to UAE law.
  6. However, if Reinsurers are based in the Dubai International Financial Centre ("DIFC"), then in accordance with Article 5.A.1 of Dubai Law No (12) of 2011 amended by Law No (16) of 2011, the DIFC Court of First Instance should have jurisdiction to determine a dispute between the reinsurer and insurer, even if it is subject to UAE law, unless the reinsurance agreement specifically excludes the jurisdiction of the DIFC Courts. Kennedys Dubai recently acted for a DIFC reinsurer in a reinsurance claim brought by a Dubai based Insurer before the Dubai Courts. The reinsurance agreement provided for arbitration, which was disregarded by the Claimant. In a jurisdictional challenge, the Court of First Instance and Court of Appeal both found (in our client's favour) that the DIFC Courts had jurisdiction. When appealing to the Court of Cassation, the Claimant also sought to refer to Article 42 of the Reinsurance Regulations. The Court of Cassation (in an August 2019 decision) did not refer to Article 42 of the Reinsurance Regulations specifically, but found that the DIFC Courts still had jurisdiction, and specifically highlighted that Article 10 of Dubai Law No (12) of 2011 amended by Law No (16) of 2011 (which sets up the DIFC Courts and gives it jurisdiction) says "Any text in any other law to the extent that it contradicts this Law shall be repealed".
  7. Reinsurers not based in the DIFC can still agree to the DIFC Courts' jurisdiction, which gives them an alternative to agreeing to arbitration.


1. Translation taken from the English version of the New Insurance Law uploaded on the website of the UAE IA.

2. Translation by Thompson Reuters Westlaw Gulf.

3. The Dubai Supreme Court.

4. Case numbers 448/2013 and 14/2014.

5. Case number 154/2015.

6. Federal Law No (6) of 2018.

7. In particular the UAE Civil Code - Federal Law No (5) of 1985.

8. Federal Law No (2) of 2015.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
BSA Ahmad Bin Hezeem & Associates LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
BSA Ahmad Bin Hezeem & Associates LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions