Two experts warn against buying “savings insurance” through unlicensed bodies

A customer insurance expert warned of purchasing investment and savings products from unlicensed companies or entities within the country.

They confirmed to «Emirates Today» that the purchase of “investment insurance” documents from licensed companies in the Emirates, and are subject to the supervision and supervision of the central bank, means that the investor rights are guaranteed 100%, even in the case of difficulty, bankruptcy or closing the secure company, indicating that the problems that are currently occurring come by foreign companies that are not licensed in the country that offer very huge commissions to mediators to market their insurance products.

Customers had told «Emirates Today» that they bought investment or savings insurance, and paid monthly installments for years, to discover later that the companies that they dealt with were bankrupt, or that they no longer operate in the market.

Customer complaints

In detail, dealers said that they bought investment or savings insurance by shoppers, who claimed that they were affiliated with international companies, and after between five and 10 years, they paid monthly installments, demanding the agreed amounts, and they were told that the companies were “bankrupt”, or no longer operating in the market.

They added that some of these employees claimed that they are affiliated with banks working in the country, or well -known insurance companies, and provided them with contracts that they obtained large sums after the end of a certain number of years according to specific investment plans.

Unlicensed companies

For his part, the former insurance expert, a member of the Board of Directors of the Emirates Insurance Federation, said, Mohamed Abandah, that “savings or investment insurance is always linked to life insurance, and comes with him as an investment or savings for the insured, and is subject to the supervision and supervision of the central bank, and there are great requirements set by legislation regarding guaranteeing the rights of investors or insured savings, or their inheritance in the sense that companies must It is committed to financial allocations, deposits and precautions, to ensure the rights of people investing in these products.

He added: «But unfortunately there are practices from some foreign companies that do not work within the state, but rather operate through brokers or agents, which lead to the sale of investment and savings products, then later problems occur and the insured loses their money.

He continued: «The purchase of investment insurance documents from licensed companies in the Emirates and is subject to the supervision and supervision of the central bank, means that the investor rights are guaranteed 100%, even in the event of difficulty, bankruptcy or closing the secure company.

He pointed out that the problems that are currently occurring come by foreign companies that are not licensed in the country, which offer very huge commissions to brokers that exceed the value of the insured’s annual installment, for example if the value of the annual installment of a person is 100 thousand dollars, the foreign company pays the mediator 120 thousand dollars to sell the insurance policy, and these amounts pay some mediators from the weak souls to sell these products as licensed although they are not.

He added: «Foreign insurance companies that operate through brokers sacrifice the installment for the first year, and commissions pay him to the mediator who sells their products, and later they achieve huge profits and sums in the rest of the years, as they are mainly that do not compensate for the insured, and do not pay him in exchange for the participation according to the agreed upon.

And Abdah indicated that “these practices have decreased a lot at the present time compared to the past years in which they prevailed as a widespread phenomenon, as awareness among people has spread to a large extent, but unfortunately they still exist.”

He said: «The customer must make sure that the company is licensed and operates from within the Emirates, whatever its name abroad, and that only dealing with licensed companies, whether local or foreign, is that the latter there is a lot within the state and licensed and works in a regular and legal manner.

He added: “If a person wants to deal with foreign companies that sell investment or savings products, he can deal with that licensed by the Central Bank, to ensure his rights in the future.”

The responsibility of the customer

In turn, the insurance expert, Fouad Abdel Hamid, said: “Individuals are required to ensure the location of the company that sells savings insurance products, because marketing employees exaggerate in displaying the benefits and benefits that accrue to the person after five or 10 years, during which many conditions change, and the insured discovers that there is no party that refers to legal demands.”

He added: «In the past, marketing employees of these products were visiting individuals in their workplace or homes, and now a lot of things are done (online), so the customer must make sure that the company operates in the UAE, or its products are already marketing by a guaranteed party, such as banks or insurance companies operating in the country.