What insurance does your bank require for a mortgage, and can you choose it?

Your lender will want the home insured for the life of the loan, and will usually want life cover too.

Does your bank require property insurance?

Yes, at the banks that publish their terms. ADCB says that “For the duration of the loan, insuring the property and maintaining a life insurance policy are mandatory.”¹ First Abu Dhabi Bank’s mortgage terms say the bank “may arrange insurance for a Property covering the Insured Risks as well as life and disability insurance for the term of a Mortgage Loan, under which the Bank is named as the beneficiary”, and that the customer pays the premium.² FAB defines the insured risks as including “fire, damage, natural disasters and civil commotion”.²

The Central Bank’s mortgage regulations say loan documents should include, among other details, the “insurance requirement”.³

What does the bank’s property insurance cost?

Two banks publish a rate in their key facts statements.

Emirates NBD’s statement says the fee is charged monthly from disbursal and “will remain fixed for the loan period”.⁴ The same statement shows life insurance at 0.0171% a month of the outstanding loan.⁴ Mashreq lists group life insurance at 0.165% a year of the outstanding loan.⁵

These are the bank’s prices. They are not a market rate.

Can you choose your own insurer?

You have a right to choose from a list. The Central Bank’s Consumer Protection Standards say that where insurance “is a mandatory component” of a loan, the bank must disclose its purpose and the cost of the bank’s own insurance product in writing, and inform you of your “right to choose an insurance/takaful provider from” a “minimum choice of 3 insurance/takaful providers” it has approved.⁶ If you do not tell the bank your choice within a reasonable time, the bank may choose from that list.⁶

The bank must also tell you if the insurer belongs to the same group as the bank.⁶ Where the bank offers insurance alongside a loan, it must tell you in writing that you can accept or reject the offer.⁶ Banks may not use “Undue Pressure” to make you buy one product as a condition of another.⁶

FAB’s terms allow that if you are not eligible for the bank’s life cover, the bank may require you to buy your own policy with the bank as sole beneficiary and show proof at every renewal.²

Ask your bank in writing for its list of approved insurers and the cost of each.

Who gets paid if you claim?

The lender has a say. Under the 2025 Civil Transactions Law, if a home is mortgaged, the lender’s rights attach to the insurance money, and once the mortgage is registered or notified to the insurer, the insurer “may not pay what they are obligated to pay to the insured except with the consent of those creditors” (Article 975).⁷

Tell your bank as soon as you make a claim on a mortgaged home.

Is the bank’s policy the only cover you need?

Not always. The bank’s policy protects the property it lends against. Check the schedule for:

• Contents. Emirates NBD describes its property insurance as helping “protect your home and belongings”, but ask for the schedule to see whether contents are included and up to what sum.⁴
• Flats in shared buildings. In Dubai the management entity must already insure the building through the service charges.⁸ Ask the bank what its policy adds on top.
• Liability and loss of rent, if you let the home. See landlord insurance.

The small print

• Sources. Emirates NBD’s figures are from its home loan key facts statement dated February 2026. Mashreq’s are from the key facts statement for its Green Home Loan. ADCB’s statement is on its standard mortgage page. FAB’s is clause 11 of its Master Mortgage Loan Terms and Conditions.⁴⁵¹²
• Consumer Protection Standards. The rules quoted are clauses 2.1.3.13, 2.1.3.14 and 2.1.3.15 on insurance sold with credit, and clause 5.1.1.78 on undue pressure.⁶