Health insurance claims touch record high at Dh16.5 billion in UAE

Abu Dhabi: The Central Bank of the UAE has revealed that the total cost of healthcare claims paid by insurance companies to insured individuals in the UAE amounted to Dh16.5 billion during the first nine months of 2024.

This marks an increase of Dh2.1 billion, or 14.6 per cent, from the corresponding period the previous year. It is also the highest growth rate in this category in nearly six years.

Health insurance coverage is mandatory in the UAE. Employers are generally responsible for providing insurance coverage for their employees, while dependents and domestic workers are typically insured either through the employer or via separate arrangements.

The apex bank also noted that insurance companies do not generate significant profits from health and motor insurance due to the high volume of claims they must pay. However, many insurers have increased the patient’s co-payment, known as the deductible, to 20-30 per cent over the years to offset costs.

The rise in claims is attributed to the increasing number of insured individuals, as reflected in the growing number of insurance policies. The health insurance sector continues to expand annually, driven by the UAE’s commitment to enhancing healthcare and health insurance services. The country has introduced initiatives to develop this sector through collaboration between government institutions, regulatory authorities, professional associations, and insurance companies. These efforts aim to modernize the healthcare and insurance ecosystem for both UAE citizens and residents.

Abdul Mohsen Jaber, Chairman of the Health Insurance Committee at the UAE Insurance Federation, told Gulf News that: “The increase in health insurance premiums and claims is due to several factors. Health insurance has become a mandatory requirement for residency renewal in the UAE, leading to higher demand from residents. Consequently, both premiums and claims have risen.”

Jaber added: “The UAE’s economic and social stability has made it a preferred destination for living and working, leading to a growing population. This, in turn, has increased healthcare expenditures. Additionally, rising hospital operating costs, the adoption of advanced medical technologies, and higher service provider fees have contributed to the increase in insurance claims and policy prices.”

He noted that post-COVID-19, public awareness of health has significantly increased. People are now more proactive about their well-being, with greater participation in health awareness programmes, more frequent medical check-ups, and a higher number of prescriptions. These factors have collectively driven up insurance claims, prompting insurers to raise premiums to maintain coverage levels.

Jaber also highlighted that many employees who have been insured for years—whether in the public or private sector—are ageing, which naturally leads to higher insurance costs compared to younger policyholders.