Cover to replace your income if you cannot work.
Cover gap to insure
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Monthly benefit needed
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Gratuity bridge
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Why the UAE leaves the gap to you
The UAE has no personal income tax on salaries, which is a genuine advantage, but the flip side is that there is no income tax funding a welfare system either. There is no statutory unemployment payout for most expatriates and no long-term sick pay. The labour law gives an employee a defined sick-leave period on a sliding scale of full, then part, then unpaid pay, and after that the salary simply stops. If a serious illness or accident keeps you off work for months, or your role is made redundant, the income disappears and the rent, the school fees, and the loan repayments do not. Income protection exists to plug that hole by paying a monthly benefit while you cannot earn. This tool sizes that benefit and then nets off what your end-of-service gratuity can cover, so you only insure the true shortfall.
Gratuity is a one-off, not a monthly wage
The single biggest planning point is the difference between a lump sum and an income stream. Your end-of-service gratuity, accrued under the UAE Labour Law and administered through MOHRE, pays out as one payment when you leave. It is real money you can lean on, but it runs out. Income protection instead replaces a monthly figure for a set period. The sensible approach this calculator takes is to add the two together: work out the total cost of covering your essential expenses for the months you want protected, then subtract the gratuity you already have in hand, and insure what is left. That stops you over-insuring and paying premiums for cover you do not need, while making sure a long gap does not drain your savings to zero. The gratuity figures here are modelled on the standard accrual rules, which you should confirm with MOHRE for your own service length and contract.
Bridging a year on AED 14,000 of essentials
Picture someone on AED 20,000 a month whose genuinely essential outgoings, rent, food, schooling, utilities, and minimum loan payments, come to AED 14,000. They want a year of cover and have AED 60,000 of gratuity accrued. The calculator works the gap like this.
| Step | Amount |
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So the gratuity handles roughly four and a half months, and the policy needs to cover the remaining AED 108,000. The chart shows the full year of essentials split into the part the gratuity bridges and the part you insure.
Reading the policy before you read the price
Two clauses decide whether a policy is worth its premium. The first is the deferred period, the gap between when you stop earning and when the benefit starts paying, often 30, 90, or 180 days. A longer deferred period cuts the premium but means you must self-fund that opening stretch, which is precisely where your gratuity and cash savings do their work. The second is the definition of incapacity: an own-occupation policy pays if you cannot do your own job, while an any-occupation policy only pays if you cannot do any job at all, which is far harder to claim. A common mistake is buying on headline price alone and discovering at claim time that the any-occupation wording and a long deferred period leave you with nothing for half a year. Match the deferred period to how many months your lump sum can realistically carry. This tool is for salaried expats with dependants or fixed commitments who would face a cliff edge if the income stopped.
Does income protection pay out if I am made redundant?
Usually not on its own. Standard income protection covers loss of income through illness or injury, not redundancy. Cover for job loss is a separate and much narrower product with strict conditions and short payout windows. If redundancy is your main worry, your gratuity plus a cash emergency fund is typically the more reliable buffer, since unemployment cover for expats is limited.
Should I insure my full salary or just my expenses?
Insure essential expenses, not the full salary. You only need the benefit to keep the household running, so covering AED 14,000 of genuine outgoings rather than the whole AED 20,000 wage keeps the premium down without leaving you exposed. The discretionary spending can pause while you are not working.