UAE Law and Practice Contributed by: Raghad Hammad and Huda Al Zein, BLK Partners
1. Basis of Insurance and Reinsurance Law 1.1 Sources of Insurance and Reinsurance Law The insurance and reinsurance industry in the United Arab Emirates (UAE) is heavily regulated. The appli- cation of relevant regulation depends on the jurisdic- tion in which the activity is carried out, with different legal regimes applying onshore and in the financial free zones. Federal (Onshore) UAE Onshore UAE is a civil law jurisdiction, meaning that the law is primarily codified and judicial precedent is not formally binding. Courts are guided principally by statutory provisions and codified legal principles. That said, decisions of higher courts (in particular the Courts of Cassation) are highly persuasive, and con- sistent lines of authority are routinely followed in prac- tice, including in insurance and reinsurance disputes. The principal sources of insurance and reinsurance law onshore are: • Federal Law No. 5 of 1985 (UAE Civil Code), which contains a dedicated chapter governing insurance contracts as a matter of civil and contractual law and sets out core principles relating to disclosure, insurable interest, indemnity, subrogation, contrac- tual conditions and exclusions. • Federal Decree-Law No. 48 of 2023 Regulating Insurance Activities, which replaced the former Insurance Law (Federal Law No. 6 of 2007) and formerly established the regulatory framework for insurance and reinsurance in the UAE, prior to its repeal and consolidation under Federal Decree- Law No. 6 of 2025. This law designates the Cen- tral Bank of the UAE (CBUAE) as the competent regulator. • Federal Decree-Law No. 6 of 2025 Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business (“2025 Law”), a consolidated law that repealed Federal Decree-Law No. 48 of 2023. It integrates insurance into the broader financial regulatory mandate of the CBUAE, although a one-year transition period is in place until September 2026 for companies to fully
align with its obligations. The transition period is one year from the date the law entered into force, and it may be extended by the CBUAE Board. The law itself does not expressly fix September 2026 as a statutory deadline. In addition to primary legisla- tion, the regulatory regime is substantially supple- mented by binding CBUAE regulations, standards and board decisions, which have direct legal effect and are central to the operation of the market. Other federal legislation may apply on a supplemen- tary basis, including the Commercial Transactions Law, the Civil Procedure Law and, where relevant, the Penal Code (for example, in cases involving fraud or misrepresentation). Financial Free Zones By contrast, both the Dubai International Finance Cen- tre (DIFC) and Abu Dhabi Global Market (ADGM) oper- ate on common-law principles. Judicial precedent is binding, and courts routinely rely on prior decisions as well as persuasive English common-law authorities, particularly in relation to policy interpretation, reinsur- ance arrangements and contractual construction. • DIFC: Insurance and reinsurance activities in the DIFC are governed by DIFC legislation, and regu- lated by the Dubai Financial Services Authority (DFSA) through its Rulebook. Contracts are gov- erned by DIFC law, which is based on common- law principles, and disputes are determined by the DIFC Courts. • ADGM: In the ADGM, insurance and reinsurance activities are regulated under the Financial Ser- vices and Markets Regulations and the Financial Services Regulatory Authority (FSRA) rulebooks. English common law applies directly in the ADGM unless displaced by local legislation, and disputes are heard by the ADGM Courts. International Agreements and Market Practice The UAE is not a party to any international conven- tion specifically governing insurance or reinsurance contracts. However, it is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958), which is of practical importance given the prevalence of arbitration clauses in insurance and reinsurance contracts.
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