UA Warns About High-Risk Companies, Requires Insurance Of $5,400

The Ministry of Human Resources and Emiratisation (MoHRE) has announced that purchasing unemployment insurance will be mandatory for all the employees working in the emirate, which the insurance scheme initiates from January 1, 2023. Private sector employees are also invited to subscribe to the unemployment insurance scheme.

The insurance program is all set to begin every month, which starts from as low as AED5 per month. This program allows receiving cash benefits for three consecutive months, not exceeding that, for individuals who have suffered job loss over non-disciplinary reasons. 

About The Insurance Program

The insurance program is divided into two categories based on the employees’ salaries. The first category of the insurance scheme covers employees with a basic salary of AED16,000 or less.

The insurance cost for this category is AED5, every month which is AED 60 per year. The maximum cash benefits the employees receive on a monthly basis, not exceeding three months is AED 10,000. The second insurance plan category includes employees with a basic salary beyond, AED16,000. The subscribing cost for this category is AED10, which is annually AED120. For three consecutive months employees can receive cash benefits of AED20,000 or less.

The claims are calculated as 60 percent of the average basic salary of the last 6 month’s job prior to unemployment. The payment for the insurance can be done in four ways, which are; monthly, quarterly, semi-annual, and on yearly basis. 

Criteria For Compensation

According to the insurance pool’s website, the employees must meet the following criteria, to be eligible for compensation:

• The insurance premiums should be paid before the due time
• The minimum subscription period must be 12 consecutive months, including no interruptions in the subscription on the first three months.
• Unemployment due to disciplinary reasons is not a factor
• Insurance claims must be submitted within 30 days of the job loss
• Should not have any complaints from the workspace
• The job loss must not be due to resignation 
• The employee must be physically present in UAE
• In case of any fraud in the claim, they won’t be entitled to compensation
• Unemployment should not be due to violent protests 
• Job loss due to any Force majeure, associated with the Civil Transition Law cannot claim the insurance
• Employees should not contribute to any terrorist activities

According to the official website of the insurance pool. The subscription to the insurance can be done via different channels. The valid subscription channels are given below:

• the Insurance pool’s official website (www.iloe.ae) and smart app, 
• Business and exchange centers in the emirate
• Bank apps and ATMs
• Telecommunication bills
• Through SMS
• Kiosks Machines

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In addition, the insurance program is offered by the Dubai Insurance Company which is the mouthpiece of the insurance pool, which consists of nine other companies. Below you can find all the insurance providers:

• Dubai Insurance Company
• Abu Dhabi National Insurance Company
• Emirates Insurance Company
• Al Ain Ahlia Insurance Company
• National General Insurance Company
• Orient Insurance
• Abu Dhabi National Takaful Company
• Oman insurance company
• Orient UNB Takaful Company

This insurance pool scheme is planned in detail after a survey of the unemployment crisis in the emirate. This program is designed to benefit both insurance companies as well as unemployees who struggle to have a decent life in the United Arab Emirates. This insurance plan helps individuals to look for available alternatives in the event of unemployment.

This scheme will improve the workforce and attract more employees to the emirate. This cash benefit program will help them to conclude a detailed plan on what they want to pursue in their career, instead of jumpstarting with whatever choices are available to fulfill their basic needs. The experts believe that in this way the economic development of the country will grow exponentially.