Tim Elliott
Welcome to Lawgical, the UAE’s first—and really the only—regular legal podcast. We’re live on TikTok today and will be from here on out. My name’s Tim Elliott. Lawgical comes to you from the Dubai-based legal firm, Yamalova & Plewka, here in JLT. As always, here’s the Managing Partner, Ludmila Yamalova. It’s good to see you.
Ludmila Yamalova
Tim, good to see you too, and thanks for being here today and embracing this new medium we’re experimenting with. We thought it would be an interesting opportunity for all of our followers who’ve been with us, listening to our podcast for—how long has it been now? Two years, three? Two plus.
Tim Elliott
It’s going to be three years this summer.
Ludmila Yamalova
Three years. We’ve recorded almost 200 podcasts together, so this is a bit of a sneak preview, behind-the-scenes, of what goes on when Tim and I get together and make our magic happen.
Tim Elliott
Yeah. No mistakes to make. Just keep talking. They won’t notice. What I want to do today is talk about health insurance and really give an overview of health insurance, because it’s been a while since we’ve all had to have health insurance. We’ll get into the details in a second. It’s been mandatory in Abu Dhabi and Dubai here in the UAE for some time. I think it’s worth starting there because the simple fact is, if you want to get a residency here in Dubai, in Abu Dhabi, in the UAE, in most cases you have to have medical covered, don’t you?
Ludmila Yamalova
Well, the short answer is yes, technically speaking, and this is because under the Federal immigration law there is a requirement, perhaps for every type of visa, in terms of requirements submitted to the authorities, in order to qualify and receive a visa, of health insurance coverage. The requirement, technically speaking, is there on the books and expressly written out in the laws. However, in practical terms, from what we have seen so far, that’s not a document that is required to be presented for most types of visas.
For example, if you’re applying for a golden visa or for a green visa or even if you want to sponsor your family to come and visit, there is acknowledgment that yes, you will be providing health insurance, but there isn’t really a requirement to actually show that you have already obtained health insurance.
There is an exception to that, and that is for employers who sponsor the employees. As part of the application itself, before employees receive their residency permit from the authorities to work for that specific company, the authorities do actually require proof of health insurance.
For example, if you work in TECOM or the DMCC or any of the other free zones, then as a company, when you hire a new employee, or even renew your employee for purposes of a residence visa, you need to submit to the authorities a copy of the health insurance plan or the health insurance coverage. At least as far as employment is concerned, there is an effective way not just to state on the books that the law is there, but actually enforce the application of this law by virtue of requiring companies to present health insurance coverage proof prior to issuing the residence visa.
Tim Elliott
Okay. And that applies to dependents. So, if I come here with my wife and kids and I’m sponsored, for them to have the stamp officially in the passport, medical insurance has to be in place for them as well.
Ludmila Yamalova
Yes. Let me perhaps take a step back and set out the legal framework in terms of the health insurance coverage in the UAE in general. At a high level, and by way of reminder to those who perhaps don’t remember or don’t know, the UAE is a federal state that has seven emirates. With regard to health insurance, it is regulated at both levels, the federal level and the emirate level, in one way or another.
Let me start with the emirate level because it is a little more established. There are two specific emirates that have had health insurance as part of their regulatory framework for a number of years. Those two emirates are Dubai and Abu Dhabi. In fact, Abu Dhabi has historically led the way with regard to health insurance and requires all residents and companies in particular, who sponsor their employees—and in the past, all employees were sponsored by their companies—to provide health insurance to their employees and also for their dependents.
Abu Dhabi had that law as long as I have been here in the UAE, which has been quite a number of years by now. Then perhaps about seven or eight years ago, if my memory serves me right, actually in 2013—so 10 years now—Dubai introduced the law with a requirement of health insurance into the system.
Let me actually be a little more specific. In Abu Dhabi, it was in 2005, and that was Law 23 of 2005 regarding health insurance in Abu Dhabi. That is the main law as far as Abu Dhabi is concerned, and that law was further clarified by virtue of regulations that were issued a year later, and that was Executive Council Decision 25 of 2006 regarding executive regulations to the health insurance law. That is in terms of legal authority in Abu Dhabi. The requirement of health insurance and the legislative framework was introduced in 2005.
Then in 2013, Dubai followed suit and introduced its own law, and that was Law 11 of 2013. That was called the Dubai Health Insurance Law, if you will. Then just recently, in fact last year, Dubai issued additional Administrative Decision 78 of 2022 regarding executive regulations to that same health insurance law. The main law was introduced in 2013 and then last year, nine years later, further regulations were introduced to add on to the main law in Dubai.
In summary, as things stand today, Dubai and Abu Dhabi are the two emirates where health insurance at the emirate level is expressly stated in the law as being a requirement for all residents in the UAE. These are the two emirates, I can tell you today, where legally speaking, health insurance is required for all residents.
For the other emirates—those are Ras Al Khaimah, Sharjah, Ajman, and Umm Al Quwain—they do not have similar laws, at least that we are aware of, that make health insurance specifically a requirement or set out a legislative framework for those emirates or require sponsors or companies, for example, to provide health insurance to their employees.
However, at a federal level, if you take it higher up, as I mentioned earlier, there is this new—in the interest of efficiency, we will call it the UAE immigration law—and that is the law on residency. This is the federal law. This is the law, by way of reminder, that introduced various types of visas, which has been quite an exciting legislative authority because it has introduced so many different types of visas into the UAE labor market and for the UAE economy. It has been a much-celebrated law.
This is the law that introduced the golden visas, the green visas, the probation visas, the various family visas, the multiple tourist visas. You and I have done multiple podcasts on the various types of residence visas and various types of visas based on this very law. Also, I have done a number of dedicated social media updates for the various types of visas because there are so many, and they have been so popular and celebrated because they have been of such great benefit and utility to so many people out there.
Obviously, the country has, at least in my experience, seen the tremendous benefits of having these visas made available and seeing so much more investment coming into the country and perhaps in the labor market itself becoming a lot more robust because there are that many more options now for various types of professionals to stay and live in the UAE without having the dependent relationship which had existed in the UAE perhaps from the beginning of the formation of the country until about a year ago.
Therefore, as we go through the process and in this discussion, I just want to set out that general legal framework in terms of which emirates have which laws. So when we say it’s required, certainly as far as Dubai and Abu Dhabi are concerned, health insurance is required. With regard to other emirates, technically speaking, all the residents who live in other emirates are also required to have health insurance, and whether that is being enforced and how it is being enforced at the immigration level remains to be seen.
But in places like Dubai and Abu Dhabi, because they have had their own laws so much longer, there are now different mechanisms built into the system that act as enforcement in the application of this law.
As I mentioned earlier, if I work in Dubai, all those companies that are based in Dubai, whenever they apply for residency for their employees, they have to present the evidence of health insurance to the authorities as part of the application. For example, when you submit the employees’ passport copies, their educational certificates, copies of their pictures, and the application that is submitted in order to apply for the visa, you will also need to submit a copy of the health insurance. It’s important because actually a lot of people don’t know about it. Still to this day, we hear a lot of comments from employees saying my company is not providing health insurance or my company didn’t give me health insurance. If they work in Dubai, their health insurance has to be there, and it has to be there by virtue of this built-in, automatic mechanism that ensures that all employees have health insurance.
Tim Elliott
So, whatever it is, it must be in place. If you’re not aware or you think you don’t have health insurance, if you have a Dubai visa or an Abu Dhabi visa, you do, and it might be the case that your company has just not told you because you’re not going to use it, premiums won’t go up, or whatever the reason might be.
Ludmila Yamalova
Exactly. I’m trying to figure out a way perhaps to explain how it is that so many employees, especially living in these two emirates, would believe that they don’t have health insurance coverage. As long as they have a visa, they must have health insurance coverage. I’ve been able to extrapolate a few theories about what is really happening.
I think, on the one hand, for a lot of companies, there are public relations officers (PROs) that process employee visas. The PROs do this and apply for dozens or hundreds of residencies, not just for that particular company but for multiple companies and multiple clients. They are just used to submitting this general packet of information and documents to the authorities, and they don’t really give much more consideration to this additional document, which is called the health insurance certificate for the particular employee, than whatever else is in the file.
For them, it is just a piece of paper and a requirement that goes through the system. Because it is the PROs often that process the visas, the employees of the company are not necessarily involved at that level to actually update employees that, as part of the application, they have health insurance coverage. That is one theory and one suggestion on why employees are ignorant about the existence of this coverage. It is because it is not being communicated to them through the proper channels.
It may be that even as far as some companies are concerned, there is a breakdown in communication between the HR department and whoever it is that processes visas and the employees. Depending on the level of the employees, they don’t necessarily appreciate the importance of sharing this information with the employees. That could also be a reason.
Then, I think maybe a third theory is that people think that these certificates are just a minimum basic coverage, and we can talk about it separately. It is basic coverage called an essential benefit plan that is a standard health insurance being provided by the insurance companies. People think X amount of money is just paid per year just to tick the box in terms of the requirement, and it does not actually cover very much. Because of that, they believe that they don’t really need to explain or let their employees know that they have this coverage because they don’t think this coverage means very much.
Tim Elliott
Okay. But if you want to live in Dubai or Abu Dhabi, you have to have health insurance. Whether you’re aware or not, you’re stating now that you do have it, and it has to be the case to get the visa stamp on your passport. Here in Dubai, the law applies to mainland companies, it applies to free zone companies, and it applies to the Dubai International Financial Centre Free Zone. I think I am right in stating that, and it’s codified under the Dubai health insurance law. You mentioned that, and the executive regulations of that law.
Ludmila Yamalova
Well, if you want to talk about Dubai, it’s interesting because we recently bolstered our research on health insurance laws and regulations in Dubai. In short, we have identified about 120 different regulations, laws, directives, circulars, notices, and guidelines issued by various authorities in Dubai in connection with health insurance.
As far as Dubai is concerned, it’s a very robust legal framework, and there are so many legislative and legal authorities to rely on with regards to the health insurance industry. Because it is not just about the health insurance requirement, but it is also for the health insurance companies themselves, for the health insurance providers, for hospitals, for submission of claims. Each one of these aspects of the health insurance industry is regulated by a variety of laws.
In Dubai, as I said, we have at least 120 regulations. There is a specific resolution in Dubai that sets out fees and penalties regarding health insurance coverage, and that is Executive Council Resolution 7 of 2016. It has been around for quite some time. Also, there is the Executive Council Resolution 16 of 2013 regarding health insurance for Dubai government employees—another legislative authority.
There is another one, Resolution 17 of 2018, regarding entities subject to the Dubai Health Authority and their competence. Then, as I mentioned earlier, one of the most recent ones is Decree 8 of 2022 regarding the application of the Dubai Health Insurance Law in the Dubai Healthcare City. As far as Dubai is concerned, there is a lot to draw from and to rely on.
This is also one of the reasons why I wanted and thought it was timely to talk about this specific topic. The law has been around for a long time, and it is unequivocal in its mandatory application. The penalties that apply are pretty severe. Yet, we hear over and over again, “Oh, my company didn’t give me health insurance,” or “I don’t have health insurance.” I just shake my head and wonder how could this still be the case.
I think perhaps sharing this with the greater public and educating, not just about the existence of the law, but also sharing the particular penalties and consequences of the breach of this law, is equally important.
Tim Elliott
That’s really interesting to me because what you have said in the last 10 minutes is if you live in Abu Dhabi or Dubai, you have health insurance. You do. You just do. To get the visa stamped, you need it. And yet, people think they don’t. It’s incumbent upon the sponsor, isn’t it—the employer sponsor—to provide it. That is how it is.
Ludmila Yamalova
Yes. That brings me to a good question, to phrase it in a more specific way, and that is, who does the requirement apply to?
In the context of employees, as I have mentioned, employees are basically, especially employees in Dubai and Abu Dhabi, by default covered by health insurance. There is an enforcement mechanism to ensure that companies actually provide health insurance to their employees, although, as we know, people are still not aware of it.
Generally speaking, the requirement of providing health insurance lies with the sponsor. This is an important point because, until recently, there were limited sponsors. You had the company that would sponsor employees or you had the family member who would act as a sponsor to sponsor dependents. Those were the two types of sponsorships.
Now with this new residency visa—or the new immigration visa—in the UAE, there are a lot of different types of sponsorships and different types of visas. But still, at a high level, the requirement for health insurance lies with the sponsor.
Let’s say, in the case of employees, employees who are sponsored by their companies, the obligation to provide health insurance is on the company. For all those family members who sponsor their dependents, their family members, the obligation is on the sponsor, i.e., the main family member.
Or, for example, if you are a resident here and you are sponsoring tourists or visitors into the UAE, once again, because you are considered to be the sponsor, the obligation is on that party to make sure that the health insurance is provided.
Even more notably, in the context of golden visas—because what is a golden visa, or a green visa, for that matter? It’s a self-sponsored visa. You are sponsoring yourself. Who is the sponsor? You are the sponsor. This is very important because it’s clear at present that this is not yet known or understood by many golden visa holders.
This is by law, and perhaps not so much enforced yet by the system, and that is, as a holder of a golden visa, you are required to have health insurance. It is required because you are your own sponsor. The laws, in particular the residency laws, specifically state that one of the requirements to qualify for a golden visa is to have health insurance coverage.
Although, from what we have seen so far, that is not yet enforced. In other words, when you apply for a golden visa, the immigration authorities do not ask you to prove or show a copy of your health insurance as part of the application. The enforcement part we have not quite seen yet, but perhaps it is just a matter of time because this is a fairly new type of visa and a new law.
But that is one interesting example. A lot of golden visa holders might have the golden visas because they are so popular, and they may actually not have health insurance just yet because they are not aware that this is actually mandatory by law.
Furthermore, and this is quite important and is another level down to it, is that as a golden visa holder, one of the greatest benefits of the golden visa, in addition to self-sponsorship for 10 years, is that you can sponsor a variety of your family members.
There is a lot more flexibility now in terms of who you can sponsor than existed before. You can sponsor your parents, your children, irrespective of age. One of the other benefits—there are so many great benefits to golden visas, and as I go through this, I am reminded—but we have done these dedicated podcasts on golden visas specifically.
One of the other benefits for many people is that there isn’t a requirement of having to come back into the country every six months. This really works for a lot of people who, for example, live here and have family members that live nearby—let’s say in India, Pakistan, the GCC—and who come to visit every so often, not necessarily every six months.
Now, if you live in the UAE and have a golden visa, a lot of these golden visa holders are sponsoring their family members because it’s easier to do, and there isn’t this requirement of renewing every two or three years and so on and so forth.
What we have seen is an increase of golden visa holders sponsoring their family members. But as part of it—and it is actually quite a fast process as well—many of them are not aware that they actually have to, by law, provide health insurance to all of their family members.
Let’s say, if you have mom and dad living in Oman or Kuwait and you live here, as long as they are your dependents, technically speaking, in terms of the law, you as a sponsor are required to provide them with health insurance. That is just how the law is structured, and that also applies in the context of hiring domestic employees as well. They are your responsibility. You are their sponsor, and you are supposed to provide them with health insurance.
That is overall the order of things in terms of who is responsible.
There is one more nuance to this, and this question comes up quite often because now so many more employees are self-sponsored on their own golden visas, but they still work for a company. The question is, who has the obligation to provide health insurance in that case?
If you work for me and you have your own golden visa, as a company, am I obligated to provide you with health insurance, or is the obligation on the sponsor and not the employer necessarily?
In short, what we have been able to extrapolate from all of the laws is that the obligation does still lie with the sponsor, not the employer.
For example, if you work for me and you have your own golden visa, you are required to have your own health insurance. I am not obligated to provide you with health insurance, although you work for me, and that’s by law. Now certainly by contract, I can offer you health insurance, and we are seeing more of that now that more employees are going onto golden visas. The companies still offer them health insurance as a benefit as part of their corporate plan.
Tim Elliott
Lots of golden visa holders are thought—in the original case of the golden visa, it was just a 10-year visa and it was people who were seen to have made a contribution to the country and to the economy. I guess lots of those people were employed, so the way things were, they were provided with health insurance, but we may be seeing a shift slightly away from that. Is that what you are intimating?
Ludmila Yamalova
At least in legal terms, yes. I will tell you, from a lot of practical experience, from our own practice and on behalf of our clients, we have seen this shift.
A lot of companies are asking because they notice their employees now want to go on their own golden visa. It gives them a sense of freedom, and for other reasons as well, it is just more beneficial for many people to have their own golden visa if they qualify. So the companies ask, how does that affect us as a company?
Obviously, one benefit to the company is not having to pay for their health insurance. The fact is, for a lot of companies, health insurance is a group plan, especially the bigger companies. Whether they have 10 people or 20 people, in terms of premiums and packages, they can actually benefit from better coverage if they have more people included in their plan. For a lot of companies, the additional expense is fairly marginal.
This is still history in the making. We are seeing this develop and evolve before our eyes, so it is too early to tell which way the trend will shift. But in the meantime, I would imagine that it won’t really change much of the dynamic in terms of the companies wanting to offer that benefit by default as part of their group plan nonetheless.
But certainly, for all those golden visa holders, it may be that they just want to have their own policy because it is easier to control the policy, or maybe they want to have a choice of what kind of policy.
But it is also important to dispel some rumors we have heard over and over again, that I am not allowed to have two insurance policies. If you have a golden visa and you have your own basic insurance policy, you still can have an add-on insurance policy through your company.
We have heard from many that somehow they are being told by insurance companies or employers that they are not allowed to have two health insurance policies, but that is not true. They are allowed. Obviously, you cannot double dip—you cannot get the same claim covered twice by different insurance providers—but certainly, you can use them to complement coverage between your own private insurance and your corporate insurance.
Tim Elliott
There is not an insurance company on earth that wouldn’t take your business. Let’s be completely honest. As you would expect in a market of the size of Dubai, there are lots and lots of different policies and group plans. There is a lot to choose from. I think we should point that out.
What I’m interested in is if you don’t communicate to an employee or a person that you sponsor that they have medical insurance, what kinds of penalties apply?
Ludmila Yamalova
Interestingly, the penalties are varied, and it depends on the underlying offense. But perhaps before we go into the penalties, I can delve a little bit into the basic coverage.
For all those who think that they don’t have health insurance because they are not being told or are being told by their companies that they don’t have health insurance, they may in fact have minimal health insurance coverage. It’s just that they aren’t aware.
In most cases, companies believe that a minimal health insurance certificate does not amount to much. But even a basic health insurance plan provides a considerable level of coverage.
Tim Elliott
Just before you go into the different types of coverage, I just wanted to state that a PRO is loosely the person who runs around doing the visa, the bureaucratic stuff. It means public relations officer.
Ludmila Yamalova
Yes. PRO stands for public relations officer. It is not really an official term, though historically that is how it started. There was a specific term called a PRO. Basically, it applies to someone who works with the government authorities and gets the paperwork processed.
Historically, there was a specific designation that was especially reserved for UAE nationals in terms of being able to approach government authorities and represent companies in front of government authorities. There was actually a specific card called the PRO card. That is the original form of the PRO officer.
With time, that evolved and became just various employees of the companies who represent the company before government authorities and who actually had the ability and skills to do so. They are still called by that same term. Now, it is a little more of a generic term than it was before.
Tim Elliott
It’s interesting actually, because you and I have been here long enough to remember the days when the PROs were seen as like magicians or wizards. They knew exactly who to go to, what time to go there, and could always get the right piece of paper signed. It’s less like that now because much of the government machinations are now online, but these were respected figures.
Ludmila Yamalova
Absolutely. I’m not sure if this is true or not, but I will perhaps share just for fun an anecdote that was given to me when I moved here by a local business partner and a friend who said that the reason the PRO system was created the way it was created was because, before the UAE became one united country, each emirate, ultimately the tribes, had their own military.
When they decided to become one country, you didn’t need to have military personnel in every emirate. They consolidated the military forces, and there were a lot of former military employees who were basically left without jobs. Since so many of them ultimately were part of the government system, it made sense for them to become the representatives on behalf of the companies with the authorities.
Back then, as you rightfully said, everything was done manually, and you had to walk and submit hard copy documents the old-fashioned way. They were truly necessary. These days, perhaps 90% of what we do in terms of paperwork and administrative work is online, and their role has shifted to more strategic and nuanced issues, rather than mundane tasks like visa renewals and health insurance renewals.
Tim Elliott
Okay. We are live on TikTok for the first time on this podcast about medical insurance. Here’s the question: My partner is pregnant. She will deliver next month. We are not married. Will the insurance provided by her company cover her delivery?
Ludmila Yamalova
This is a great question. The short answer is that it should. I will tell you, we’ve had a number of questions like this recently with a baby coming up, but no insurance or the marriage certificate issued yet. Will the delivery be covered? Will the mother be covered? Will the baby be covered?
Remember, these are all three different stages: the mother’s own care, then pre-delivery and during delivery, and then the mother herself, if she has any complications related to birth—whether that will be covered or not. Then there is the baby, the baby’s birth, and the baby’s further medical treatment, if need be. These questions come up quite regularly. The short answer is yes. Health insurance should cover all of these parties and circumstances.
It is interesting because we have actually reached out, and I’ll tell you why first, perhaps logically, and then I will give a bit of a legal justification. Logically, when the mother gets pregnant, most insurance policies here cover maternity. Legally, I have never actually seen maternity coverage conditioned on being legally married. I have never seen that.
Now we know these questions didn’t really come up in the past as much because having a baby out of wedlock or a pregnancy without a marriage certificate was previously illegal. They are not illegal anymore. It has become a lot easier to not only have these kinds of relationships here but also to deliver children here without necessarily a marriage certificate—not just because the laws have changed, but also because society and institutions have changed, and it has become a lot more acceptable.
Yet, because of that, these discussions are coming up a lot more. I have been told by employers or companies that the health insurance does not cover this. I don’t know where that comes from, to be honest with you, because legally, I have never seen a single health insurance policy that has a specific condition stating you can only benefit from maternity coverage if you are legally married. I have never seen one.
Furthermore, on the back of the multitude of questions we have received recently, we have gone back and researched the health insurance laws themselves and also talked to various health insurance brokers and contacts that we know, and asked that very question. We have not once seen a source that even remotely suggests that being legally married is a condition for maternity coverage.
That is basically the overall premise. Therefore, if your health insurance includes maternity coverage, then by default, that will cover your pre-delivery visits to the doctor, your delivery itself, any issues related to the mother, and also, by default, all health insurance plans that cover maternity also cover the baby for the first three months.
That makes sense. The baby does not have a legal identity yet to qualify for their own visa until they have been born, discharged from the hospital, and had their birth notification, birth certificate, passport, and residence visa. You cannot apply for health insurance here for a resident that is not a resident.
For a baby to even apply for health insurance, you do need to go through that process of the birth notification, which is issued by the hospital. On the back of the birth notification, you’ll apply for the birth certificate.
Tim Elliott
And it will take some time.
Ludmila Yamalova
Well, these days it’s taking a lot less time. But in the past, yes, for sure. Even today, there could be complications where the baby or mother does not leave the hospital for a month.
The last thing on their minds in that case is applying for paperwork. Then you get the birth certificate, and you apply to your embassy for the passport. Depending on the embassy, it could take a few weeks. Once you have the baby’s passport, only then can you apply for them as a resident dependent. That’s a process, and only then can you apply for health insurance.
I have not seen anything to the contrary. There may be some exceptions, but I have not seen any maternity coverage that excludes the baby because that would be nonsensical. Therefore, all maternity coverage, usually by default, includes the baby’s treatment for at least three months. It includes any kind of emergency related to the baby and also regular treatment such as vaccines for the first three months.
That is a very long-winded answer to the question. It should not be the case that coverage is denied, but nevertheless, we are hearing that a lot of people are being told this. Legally speaking and contract-wise, we have never seen anything to substantiate that theory.
My recommendation to anyone that finds themselves in that situation is to simply get copies of all the insurance policies and read carefully to see if there is any kind of exception like that. If you don’t find an exception, that means it does not exist. I predict there won’t be such a clause in the agreement, and therefore, the mother and the baby will qualify for health insurance coverage.
Tim Elliott
Okay. Mother and child for three months. Legally married or not, it doesn’t make any difference. Hello, Ma’am. My company said they will be deducting the amount for the health insurance from my salary. Can they do that?
Ludmila Yamalova
Well, no. By default, no. That goes back to your previous question, which I have not answered yet, and that is in terms of the penalties, because there is a specific penalty for that.
Let’s say I offer employees coverage to the tune of AED 5,000 a year, and that is all I’m willing to pay or able to pay. But you, as an employee, want better coverage. You want a policy that costs AED 10,000. I am not required to provide you with health insurance of your choosing. I am only required to provide you with a basic plan.
However, if I am providing a lot more than just a basic plan and I pay AED 5,000 on your behalf, but you want an AED 10,000 policy, we can agree that I provide that to you. I can either offer it to you as additional compensation, or I can offer to pay for it and deduct the difference—the AED 5,000 gap—from your salary.
Tim Elliott
That would need to be in an employment contract in some form, wouldn’t it?
Ludmila Yamalova
Sure. It can be a separate undertaking. You and I can sit down and agree that there is an additional AED 5,000 that you have asked me to pay for you. It is ultimately like a loan that I am paying to you in advance, and therefore, I can deduct that from your salary.
By the way, under the new employment law, any kind of deductions from salaries or end-of-service benefits, for example, are very strictly regulated. Even previously, deductions were not supposed to be loosely applied, as many companies may have done. But now, as per the new law, it is even clearer—there are very few deductions that can be made, and there are specific requirements as to how they must be done.
As you rightfully said, one of the requirements is a very specific undertaking or agreement on how I am going to be deducting the amount. I also cannot deduct all of it right away. There are specific steps on how much I can deduct from your monthly salary.
Tim Elliott
Lots of questions to ask you, Ludmila. If the PRO of the company did not cancel the health insurance of a worker, is there a way to solve it? They did not issue my working visa for two years and no Emirates ID either. I am not even aware if I have any insurance, which goes back to your earlier point of it not being communicated. Now that they have canceled me, the new company applied for a visa, and it shows that I have huge insurance fines.
Ludmila Yamalova
Interesting. The insurance fines—let’s go back to your previous question about health insurance fines. There are so many different types of fines that can apply, and this is why we said earlier this topic is important because a lot of people don’t know. The law is there, but they may not be aware of the obligation and the consequences if they don’t follow the obligations.
The fines depend on which emirate you are in and where you are working, so there are a lot of nuances. But at a high level, the penalties—for example, in Dubai—for violating the Dubai health insurance laws range from AED 500 to AED 150,000, depending on the circumstances.
For example, for employers or companies who fail to provide health insurance to their employees, there is a fine of AED 1,000 per employee.
As a company, if I don’t give you the insurance, to all those who are listening, if your company is telling you that you don’t have health insurance or you think you don’t have it for some reason, then there is a fine of AED 1,000 per employee.
By the way, it is interesting—the law says a fine of AED 1,000 per person for employers or sponsors who do not provide or make accessible health insurance to their employees or dependents.
Tim Elliott
That’s interesting.
Ludmila Yamalova
Make accessible means basically that ignorance of the policy is also a breach of the law. If the company is not communicating with you, theoretically or technically speaking under the law, that is also a violation, and therefore, the company is subject to the fine.
Tim Elliott
So, if you didn’t communicate it or hand over the physical health card or tell somebody how to use the app where the health card resides—because most of it is online here now—the sponsor company is liable.
Ludmila Yamalova
Indeed. Exactly. Then, another fine, which is interesting and directly related to the listener’s question, there is a fine of AED 10,000 per person for employers who require their employees or dependents to cover the cost or part of the cost of their health insurance.
This is in addition to returning the cost to the employee or the dependent. In other words, let’s say in our listener’s case where your employer is deducting money, you may want to bring this to their attention. This is assuming you are based in Dubai, but Abu Dhabi might have a similar provision.
The Dubai Executive Council Decision 7 of 2016 sets out fines and penalties in connection with health insurance claims. This specific law states that companies requiring employees to compensate them for health insurance will be fined AED 10,000.
That is a fine on the company, and that’s in addition to reimbursing the employee for the health insurance coverage.
Let’s say, going back to you and me, if you were my employee and your health insurance cost AED 12,000 a year, and I had been deducting AED 1,000 every month, and now six months into it, you find out—you can report me.
As a company, legally speaking, I should be subject to the AED 10,000 fine for the violation, and I will have to return to you the AED 6,000 that you have reimbursed me for the health insurance. Technically speaking, the penalties are fairly serious.
Tim Elliott
I’d report you.
Ludmila Yamalova
I’m sure you would.
Tim Elliott
Let me tell you. Let me ask you two more questions. The first one is this: I was diagnosed with cancer recently, somebody writes in. You have positive thoughts from us on this. I’ve been through that, so positivity coming towards you. My insurance is expiring at the end of the month. I haven’t started my treatment yet. It looks like my employer doesn’t want to renew my insurance because they don’t want to pay a higher premium for me. Is it legal for employers not to renew employees’ insurance?
Ludmila Yamalova
To renew—as long as the employee remains employed and sponsored by the company—the obligation to have the health insurance and to continue to renew it remains.
However, the premiums—it’s an interesting question because, at this point in time, I am not sure necessarily if the premiums would go up. But let’s say if they are going up and going up substantially, there could be an agreement between the company and the employee about the additional premiums.
As I mentioned earlier, there is a requirement to provide health insurance to the employee, but there isn’t a requirement to provide certain kinds of coverage. The basic coverage must be provided, but anything above that—or whatever is contractually agreed on—is basically up to the parties to decide.
In this case, let’s say, depending on how your contract is drafted, if the contract says the company provides you with health insurance, period, and now as part of the renewal the premiums go up and the company cannot reduce those premiums, then by default, the requirement to renew, even if it is at higher premiums, may still remain.
However, if there is a limit in the agreement itself that says the company will provide you with health insurance and this is above just the basic health insurance coverage—let’s say AED 12,000 a year—but anything above that, they are not responsible for, then in this case it may be that the company can still renew the insurance and pay the AED 12,000. But the margin or the difference between that amount and the higher amount would be your responsibility if you wanted to pay that extra.
Tim Elliott
Final question. My family is with me and on my sponsorship. Does my employer have to provide medical insurance for them also?
Ludmila Yamalova
A great question. No. The answer is no. The general rule is that the requirement for health insurance is on the sponsor.
If it’s your family, your obligation as a sponsor is to provide them with health insurance. Some companies offer this as a benefit to their employees, but it’s more contractual and not mandated by law. So, in this case, it’s not the obligation of the company at all. It is your own obligation unless you have a specific provision in your agreement that provides otherwise.
Tim Elliott
Alright. Thank you for the questions. I think that pretty much wraps it up, Ludmila.
Ludmila Yamalova
No. One more point about essential benefits. This is for all of those who have just basic health insurance coverage.
A lot of people think, oh, I don’t have any insurance. As I said earlier, even if you have a health certificate, it is a form of health insurance coverage, and that health insurance coverage, by the way, under the Dubai law is called the Essential Benefits Plan.
It actually has a specific name. To be even more specific, the law has a definition of basic coverage. Basic coverage is the minimum health benefits to be provided to the resident in accordance with the resolution issued under the law, and this is called the Essential Benefits Plan.
Under the Essential Benefits Plan, it specifies the bare minimum benefits and coverage which every health insurance plan in Dubai must include. This is not subject to debate.
For example, under the Essential Benefits Plan, the annual aggregate claim limit is AED 150,000 per year. In other words, it covers claims up to AED 150,000 a year.
It covers basic tests, diagnosis, and treatment within Dubai. This is important. It covers all kinds of basic tests, diagnosis, and treatments within Dubai and possibly other emirates, depending on the insurance, as well as emergency medical treatments in all emirates.
In other words, if you are a resident in Dubai and sponsored by the company, then you will have this essential coverage, an Essential Benefits Plan. Therefore, you will have coverage, but this coverage has a more limited set of providers and limited types of coverage. You cannot go to any hospital—there are specific hospitals that are included. But there are minimal benefits, and certainly emergencies are covered under the law.
Tim Elliott
That’s another episode of Lawgical, health insurance here in the UAE—an overview, a catchup if you like. Essentially, it’s the law, and you need it. It is most likely in place, particularly if you are employed, working, and have a visa here in Dubai or in Abu Dhabi as well.
As always, thank you for listening. Thank you to our legal expert, as ever, the Managing Partner here at Yamalova & Plewka, Ludmila Yamalova. Thank you.
Ludmila Yamalova
Thank you, Tim.
Tim Elliott
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