As per the new guidelines issued by the Central Bank of the UAE (CBUAE), outlined in Article 7.1 of Circular No. 1/2024 dated April 1, 2024, and taking effect from February 15, 2025, all insurance premiums are now mandated to be paid directly to the insurance companies. This directive aims to ensure greater transparency and improved efficiency within the insurance sector.
Key Regulatory Changes:
As per Article 7.1, insurance brokers are strictly prohibited from collecting any insurance premiums, under any situation.
Effective from 1st January 2025.
- All invoices booked in 2025 must be paid directly to the insurance company only.
- The credit facility previously provided by Al Ittihad Al Dowali Insurance Services LLC will be discontinued. Going forward, all premium payments must align with the credit terms set by the insurance company. (Note: Al Ittihad Al Dowali Insurance Services LLC will attempt to arrange similar terms with the insurers, but final approval lies with the insurance company.)
- Payments for retail and individual policies must be completed via a secure payment link.
- Fleet policies and other general policies will be required upfront PDC’s before issuing the Policies, as per the agreed credit terms.
- The insurance company’s finance team will assess the AECB credit score of the client to determine suitable credit terms.
- Dealing in cash in any matter related to Insurance Brokerage going forward will be prohibited.
- Premium Refunds and Claim Settlements will be paid directly by the insurance company to the respective policyholders.