In the United Arab Emirates, aggregators are changing the insurance landscape. With every insurance product, including home, car, health insurance, and travel available through only a matter of clicks on a smartphone or a laptop, we see a new level of ease and transparency that is changing the way people buy insurance within the country. Comparison shopping is by far the most convenient way to choose a product or service that satisfies one’s specific needs while still offering the greatest value for money. For example, any insurance plan is a one-year commitment, such as health, car, or home insurance. Choosing the wrong insurance cover will have major financial implications. Customers are drawn to an insurance comparison platform for a variety of reasons. It’s perfect for users who do not have much time and do not want to spend time reaching out to individual insurers for quotes. Users who want to compare numerous insurance quotes and purchase their policies online from the convenience of their homes incline towards aggregator platforms. Though consumers enjoy the rewards of comparison shopping, insurers stand to gain in a big way as well. Both locally and internationally, insurance aggregators have proved to be a very successful sales and distribution channel. Incumbent insurers achieve a digital edge by working with aggregators, which will expand their scope and business. Insurers can take advantage of using the aggregator’s extensive repository of valuable data on customer demand and their purchase behavior in order to develop new products and services that meet the needs of the consumers. There has been a substantial increase in the number of insurance aggregators entering the UAE market in recent years. In 2016, Souqalmal.com was one of the first insurance aggregators to enter the country’s insurance aggregation market after it successfully established its presence in banking and personal finance comparison portal in Saudi Arabia and the UAE.
Although the overall economic slowdown has impacted the insurance industry as well, the UAE insurance market continues to be flourishing and going strong. For instance, as mentioned above, Souqalmal.com has an insurance aggregator portal wherein it makes the task of finding insurance quotes a lot easier and simpler for consumers. In UAE, the laws and regulations for price comparison websites are set down in Article 15 of the Insurance Authority (‘IA’) Board of Directors’ Resolution No. 18 of 2020 Concerning the Electronic Insurance Regulations (the ‘Electronic Insurance Regulation’). It goes without mentioning that any website that compares insurance quotes must be registered with the Insurance Authority. Article 15 (4) states that a price comparison website that deals with insurance should be registered according to the Commercial Companies Law or one of the financial free zones in the UAE. Article 15 (1) states that except for insurance brokers, the insurance companies are prohibited from dealing with price comparison websites. Furthermore, it also states that the insurance companies should take special care and abide by the prices and the coverage that appears on the price comparison websites in dealing with insurance brokers that deal with the price comparison websites. Certain obligations also bind the insurance brokers in dealing with price comparison websites.
The Authority requires the brokers to adhere to the following:
1. not to deal with the websites that are not registered with the Authority.
2. submit a copy of the agreement signed between the insurance broker and the owner of the price comparison website.
The following points must be included in such an agreement:
a) issuing or marketing any kind of insurance policies is restricted,
b) communication with the customers is restricted,
c) issuing insurance certificate is restricted,
d) limitation of service (comparison services only)
Apart from the restrictions or limitation that the insurance brokers can enforce through the agreement, the Insurance Authority below has imposed the following restrictions on the price comparison websites:
1. not to be engaged in the activity of the insurance broker, agent, or other insurance-related professions.
2. avoid storing, downloading, or maintaining any electronic records or information about potential customers. Any such information must be transferred to the insurance company or provider with no copies made.
3. other than charging a handful of amounts which is the referral allowance, there is a restriction to charge a commission for the services provided by them,
4. strictly restricting the scope of websites to premium comparisons and must be stated on the website clearly.
The regulation contains provisions for dealing with price comparison website violations. If any violations are proven through the evidence available to the Insurance Authorities or to the Competent Authorities, the following measures will be taken:
i. issuing a warning to take corrective measures to rectify the violation within a certain time period.
ii. If the problem is not resolved within that time period, the price comparison website will be further prohibited in dealing with the Insurance Broker for a period not beyond six months.
iii. If there are repeated violations, such a website will be temporarily blocked for a period in coordination with the Competent Authorities, or it will be completely blocked with the direction of the Insurance Authority.
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To establish a price comparison website, one needs to have a domain name. The websites’ domain name shall be registered in line with the Telecommunications Regulatory Authority’s (TRA). There has been a rise in domain name registration which is the ae. TRA has established .ae Domain Administration (AEDA). The AEDA is responsible for regulating, enforcing, and laying down policies related to the operation of the.ae, as well as resolving domain name disputes.