Healthcare costs will be more manageable for UAE residents, with the government announcing a mandatory insurance scheme for all private sector employees and domestic workers. The scheme will be implemented from January 1, 2025.

As reported by Khaleej Times, the new scheme comes as a relief for employees who don’t have a company-sponsored health cover and can’t afford to pay for one. While premiums and costs may increase for employers, ensuring a good health benefits package will help them attract and retain talent.

Mandatory health insurance is currently applicable only for employees in Abu Dhabi and Dubai, as these two emirates have enacted locally applicable laws. The new system obliges employers to protect their staff nationwide from healthcare costs.

In Dubai, it’s mandatory for employers to offer a package to their staff. The employees themselves are responsible for getting family members under their sponsorship (dependents) registered in a scheme.

In Abu Dhabi, employers and sponsors must mandatorily offer coverage for their employees and their families (one spouse and three children under 18).

Once rolled out, will employees be required to pay for the insurance scheme?

No. By law, employers and sponsors will be required to bear the costs for their staff and domestic workers. It’s not immediately clear if the law will obligate companies to pay for schemes for their employees’ family members.

How will the UAE enforce the rule?

According to a statement released by the UAE Cabinet, employers will need to get a healthcare package for their workers while issuing or renewing their residency permits. This means providing a plan to an employee or domestic worker could be linked to visa issuance or renewal, as is the case in Abu Dhabi and Dubai. In both emirates, visas are not issued or renewed unless the applicant has valid health coverage.

Will there be a fine for not getting health coverage for employees?

Penal measures have not been specified yet for the UAE-wide scheme. For existing schemes in Abu Dhabi and Dubai, fines range from Dh300-500 per month per individual.

What will the insurance scheme cover?

The UAE has not yet spelt out what the mandatory insurance would cover for beneficiaries. However, even essential benefits plans or basic packages — which employers in Dubai get for staff earning less than Dh4,000 a month — cover “emergencies, surgeries, medical diagnosis, medication, both outpatient and inpatient treatments, and maternity care”, according to insurance aggregator Policybazar.

“With that said, there are certain limitations and conditions in place along with co-insurance requirements where the insured person is responsible for a portion of the cost,” the company says on its website