In a move that has been eagerly awaited by the public for some time, Sheikh Mohammed bin Rashid announced the Health Insurance Law in November 2013, mandating that employers must provide compulsory health coverage for all staff. This coverage is also expected to span out to include spouses and children if they are living in the UAE. The new announcement is set to take effect in early 2014 and will be fully rolled out by mid-2016. To show the seriousness of their intentions, anyone found to be in breach of this new law once it takes effect will be fined up to AED 500,000.
Following the announcement, UAE-based and London-listed healthcare operator NMC Health’s stock rocketed 10 percent. As new revenues begin to flow in, this should lead to more investments in healthcare. A senior specialist in emergency treatment at Rashid Hospital’s trauma center in Dubai, Dr Gulam Naroo said, “This is very, very important, especially in providing care to the lower-paid members of society who cannot afford health care.”
Insurance companies are also set to gain from this new law. A deputy manager at a local insurance brokerage had this to say, “There should be [new products]. Abu Dhabi currently offers a basic product for around AED 600 that covers almost everything.” These types of new products would greatly benefit the lower-income workers in Dubai. Employers will be able to choose between 40 insurance companies that are currently authorized by the Dubai Health Authority. Mohammad Kamal, who is the director of equity research at Arqaam Capital commented by saying the new law will lead to “a substantial rise in insurance claims and premiums written.”
Dr Haider Al Yousuf, Director of Health Funding at the Dubai Health Authority, said this about the new health insurance law, “This is about bringing happiness and satisfaction to everyone in the community.” With two-thirds of the population of Dubai currently not covered by mandatory medical insurance, this is an important step taken by the government to solidify Dubai’s intention to become a leading lifestyle destination and business hub.