The UAE Insurance Authority has issued a resolution to postpone the implementation of a decision (No. 49 of 2019) concerning Instructions for Life Insurance and Family Takaful Insurance ("Life Regulations") for six months from 16 April 2020 to 16 October 2020.
The Life Regulations were issued last October after two years of consultations on the draft.
The new rules provide more clarity on the terms and conditions of life insurance policies. These include premium, insured sum, charges and an annual account statement for each policy. The Life Regulations introduce in a mandatory free-look period of 30 days, enhanced disclosures to customers and transparency in terms of other charges and fees and aim to cut down on mis-selling of life insurance products. Among other provisions too, there will be a commission cap of 4.5% on the sale of offshore bonds or portfolio bonds.
A blog on the website of the law firm, BSA, reads, “Given the unprecedented times we are living in, where insurance companies are faced by large and uncertain claims exposure, in health, travel and especially life insurance, the extension by the UAE Insurance Authority is a step in the right direction, as it will give insurance companies time to focus on dealing with other immediate concerns.”
The decision to postpone the new life regulations is part of a bundle of measures announced by the Insurance Authority to support the insurance sector, in the face of challenges posed by the global spread of COVID-19.
The regulator has also relaxed rules for handling health insurance claims, giving insurance industry players, including brokers, more time to submit annual and quarterly financial statements and technical reports.