MANAMA: United Arab Emirates life insurance premiums are set to grow 18 percent annually, reaching 64 billion dirhams within the next three years, the latest study claims. The study confirmed a growing demand for life-insurance premiums as the increasingly sophisticated UAE mortgage markets adopts preferred global insurance practices to back mortgage applications.
"Mortgage lenders across mature markets in Europe, the US and the Far East often view life-insurance payment and mortgage-protection cover as one of the primary securities to support mortgage application," said Nigel Watson, sales director at Nexus Group of Companies.
The UAE mortgage market, currently valued at AED20 billion, is estimated to grow to AED64 billion within the next three years alone.
The sales director said: "Mortgage-payment protection schemes offer short-term coverage of mortgage payments when a home owner is unexpectedly out of employment or requires assistance due to sudden illness or an unfortunate accident. It is important to understand that mortgage-payment protection does not cover the entire repayment of a mortgage loan."
As the UAE mortgage market matures, local and international insurance firms are beginning to offer several types of mortgage-payment protection schemes, and, according to recent data, 71 percent of first-time buyers in the UAE are now opting to use mortgages to finance their property purchases.