If you’re an insurance customer in the UAE, read this post till the end. Starting February 15, insurance customers in the UAE will have to make payments to the insurance companies instead of connecting brokers.
Previously, as per the Central Bank of the UAE ( CBUAE) regulations, brokers were permitted to collect the premium value for normal insurance before the payment to the insurer. But now, the rule has changed.
Benefits For Customers
This regulation has a positive and functional advantage for customers. It delivers solid financial security to them, as their payments will go directly to the insurance provider companies. This will also save time by making the claims process quicker and smoother.
After the new insurance rules in the UAE come into effect, brokers will no longer collect premiums from insurance customers. Instead, they will focus on assisting customers with advice and services. Furthermore, insurers must pay brokers their commissions within 10 days.
This change also prohibits brokers from offering discounts by reducing their commission encouraging them to choose quality over price. Under this rule, brokers will not be allowed to participate in financial arrangements with non-insurance firms. This changed policy also required brokers to regulate the minimum amount of capital and to store customer data securely in the UAE.
“Customers will benefit from greater financial security as their payment will be directly submitted to the insurance company, minimizing the risk of delays and boosting the claims process. These regulations will remove the financial risk of collecting and managing premium collection so that brokers can focus on client service and advisory”. Avinash Babur, CEO of Insurance Market.ae.
“Claim payouts and premium refunds must be directly from insurers to customers. The changed insurance policy also affected the insurance sales through web comparison websites and other third parties, which came from brokers. Insurers and brokers must match their practices to showcase these changes by February 15.” In sum, these changes are made to increase the safety, transparency, speed, and quality in the insurance sector in the UAE”. Toshita Chahaun, business head at Policybazaar.ae
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