Co-authored by Nour Gemayel

On May 23rd, 2018, the United Arab Emirates ("UAE") Insurance Authority ("IA") issued Decision No. (13) of 2018 regulating bancassurance, or insurance policy marketing through Banks in the UAE (the "Decision").

Prior to the release of this Decision, in the absence of any regulations for bancassurance, insurance companies were able to uncontrollably increase their market share while relying on the banks' existing customer base. Insurers were able to easily market insurance policies through banks without the need for any sort of licensing and/or registration from the IA.

Accordingly, foreign insurance companies could easily access the UAE insurance market through banks, and the contractual relationship and/or activities of said insurance companies and their partner banks were in no way regulated or supervised.

What has changed?


Pursuant to Article 2 of the new instructions of the IA, no insurance company will be able to conduct bancassurance without obtaining the prior approval from the IA. 


  • The bank will need to obtain an approval from the Central Bank.
  • The bank and the insurer will then together need to obtain the approval from the IA.

These approvals are valid for periods of 1 year (ending at the end of December each year) and will therefore need to be renewed on an annual basis.

Further, Article 2 states that "the contractual relationship between the company and the bank may not include any form of insurance agency, insurance brokerage, insurance consultancy, or any insurance-related profession; it shall only be limited to establishing a marketing channel".

New requirements regarding insurance companies:

 As opposed to the status quo before the issuance of Decision No. (13), the new instructions require all insurance companies (and Takaful insurance companies) wishing to market insurance policies through banks to be established in the UAE, and to be licensed to operate in the UAE (whether through a branch or an insurance agent).

The IA further protects beneficiaries of insurance policies by requiring insurers to have a branch in the Emirate where the bank is marketing its policies.

This decision also protects local insurance companies, as the insurance market will now be limited to licensed insurance companies that have a validly registered scheme.

Contractual relationship between the bank and the insurer:

The IA has introduced a list of minimum requirements regarding the bancassurance agreements between banks and insurance companies.

Amongst other requirements, the agreement will specifically need to mention:

  • The agreed commission of the bank, how it is calculated, the due dates thereof, and the procedures for its collections.
  • A statement showing whether the bank is authorized to receive insurance premiums, and the obligation of the bank to transfer all premiums to the account of the insurance company with a regular detailed statement of such premiums.  

IA's supervision:

Subject to the Central Bank's approval, the IA will also, pursuant to Decision No. (13), be able to carry out inspections and supervisions over banks in order to ensure compliance with the Decision.

Pursuant to the Decision, all companies currently selling insurance policies through banks have been granted a period of six months to rectify their status and to obtain approval from the Insurance Authority to pursue their activities.

The new instructions from the IA regarding bancassurance are bound to fundamentally revamp the market, as international (foreign) companies will not have access to the UAE insurance market without being registered, and existing UAE insurers will have to satisfy strict conditions to have access to the bank's existing customer base in order to market their products.

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.