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UAE: Range of basic pay of CEOs of foreign insurers wider than those of locals

Source: Middle East Insurance Review | Apr 2018

The basic salary of an insurance CEO in the UAE falls in a wide range among foreign insurers from under AED80,000 (US$21,784) to AED230,000 per month with a higher frequency of increments, according to a recent compensation survey among insurers.
 
   On the other hand, CEOs of national insurers are largely within the AED120,000-170,000 per month bracket reviewed every 24 months on average, added the report by Insurance Monitor.
 
   The compensation survey was conducted in February 2018. A total of 12 insurers participated in the survey, including eight local and four foreign insurers. The positions reviewed were: CEO; CFO/Head of Finance; Core Services: Head of Technical Departments and Head of Distribution; and Support services: COO/Head of IT, CHRO/Head of HR and Head of Legal.
 
CEO and CFO
As for CEO performance pay, a pre-agreed bonus amount or a multiple of six months’ pay subject to performance appears to be the common arrangement across 66% of respondents, while about 25% of respondents use relative measures like percentage of technical profit ranging between 1.5% and 2.0%.
 
   In addition, the survey found CEO benefits to be better packaged among foreign insurers with long-term incentives such as share options, comprehensive family benefits and end-of-service benefits that occasionally supersede the UAE Labour Law.
 
   The basic salary of insurance CFOs is seen to average between AED30,000 and AED75,000 per month as cited by 76% of respondents among national insurers. Foreign insurers, on the other hand, report a wider spread ranging between AED30,000 and AED100,000 per month. 
 
   CFO performance pay is more commonly computed as a multiple of monthly basic pay ranging between 1 to 6 times of basic salary or up to two times of gross salary, subject to performance or the achievement of Key Performance Indicators (KPIs).
 
   CFO benefits appear to be fairly similar among foreign and national insurers.
 
Heads of core services
The basic pay of the Head of Technical Services and the Head of Distribution is seen to be relatively similar with 57% and 66% of respondents citing the AED50,000-to-100,000 range per month respectively.
 
   Performance pay as a multiple of monthly basic pay ranging from 1 to 6 times, subject to performance, is the most common performance incentive for the Head of Technical Services. While the same is true for the Head of Distribution, 17% of respondents cite that percentage of GWP is applied as an incentive scheme.
 
   Technical Services refers to core insurance functions: underwriting and claims.
 
Heads of support services
The basic salary averages between AED50,000 and AED75,000 for the Head of IT (50%), under AED50,000 for the Head of HR (84%) and AED30,000-50,000 for the Head of Legal (42%).
 
   As for performance pay, while a multiple of the monthly basic pay appears to be the standard arrangement, 25% of respondents cite that relative measures like percentage of GWP are adopted as an incentive for the Head of IT. This may be tied to digital distribution. M 
 
AED1 = US$0.27 
 
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