As Dubai’s off-plan property sales continue to dominate the real estate market, the demand for term life insurance is witnessing significant growth.
Industry experts highlight its importance for both borrowers and lenders in securing mortgages and safeguarding families.
In November alone, Dubai recorded 12,543 property transactions, an 18% increase compared to the previous year. The total sales value reached Dh30.5 billion, with off-plan sales accounting for 60% of transactions, valued at Dh15.8 billion—an impressive 35% year-on-year growth.
Ayman Youssef, managing director of Coldwell Banker, emphasized the role of term life insurance in mortgage agreements.
“Life insurance ensures the mortgage balance is covered in the event of the borrower’s death, reducing financial risk for lenders and protecting families from potential loss of property,”
he said. Youssef noted that while term life insurance is mandatory for mortgages issued by banks, developers do not impose this requirement.
Expats are driving this trend, with many seeking to secure their families’ futures while investing in Dubai’s thriving property market. Avinash Babur, CEO of Insurancemarket.ae, explained that individuals are the primary buyers of term life insurance, as companies in the UAE typically prioritize health insurance due to regulatory mandates.
The cost of term life insurance varies based on factors like age, health, and loan tenure. For a healthy, non-smoking borrower in their 30s or 40s, premiums for a Dh1 million mortgage range between Dh1,200 and Dh2,000 annually for a 20-year term.
With the UAE’s real estate and mortgage markets growing rapidly, term life insurance offers peace of mind to borrowers and lenders alike, reinforcing financial stability in this dynamic sector.
News Source: Khaleej Times
