Briefing

UAE insurance claims – A jurisdictional conundrum part 2

Jurisdiction clauses in insurance contracts are intended to provide certainty, yet in the UAE they have generated considerable uncertainty, particularly over the respective jurisdiction of the onshore and DIFC Courts. A recent decision of the Conflicts of Jurisdiction Tribunal (CJT) provides important guidance on this issue, ruling that the onshore Dubai Courts, rather than the DIFC Courts, had jurisdiction over a dispute involving an onshore insured and risk with no relevant connection to the DIFC.

Jurisdiction over insurance disputes in the UAE is not straightforward. On the one hand, the UAE Federal regime provides that disputes under insurance contracts should be heard in the courts of the Emirate where the insured is domiciled or the insured property is located, and parties cannot contract out of this requirement¹. On the other hand, the DIFC court have accepted non-exclusive jurisdiction of insurance disputes concerning UAE based parties/risks with no connection to the DIFC under its opt-in provisions² where the policies in question contain a “Courts of the UAE” or “Courts of Dubai” type jurisdiction clause. This has created the risk, and in some cases the reality, of parallel proceedings before the onshore and DIFC Courts. Conflicts between judgments are dealt with at a Federal level by the Union Supreme Court (USC) and, in the case of conflicts between the Dubai onshore Courts (Dubai Courts) and the DIFC Courts, the CJT.

In Application No. CJT-008-2026, the CJT has now had to grapple directly with such a conflict. The decision provides some clarity on how such cases are likely to be treated and may limit insurers’ ability to invoke the jurisdiction of the DIFC Courts in similar circumstances going forward. However, important questions remain. This article considers the implications of the decision and what the future may hold for the resolution of insurance disputes in the UAE.

Background: the position before the CJT decision

The DIFC Courts have previously taken an expansive view of their own jurisdiction over insurance disputes. Where a policy’s jurisdiction clause refers to the “Courts of Dubai” or the “Courts of the UAE”, the DIFC Courts have held that this is enough, on its own, to give them jurisdiction without any other nexus to the DIFC and even in circumstances where the insured has already started legal proceedings onshore.

That approach, taken in Al Buhaira National Insurance Company v Horizon Energy LLC and in Union Insurance PJSC v International Precious Metals Refiners LLC, has a practical consequence. An insurer could bring proceedings in the DIFC Courts for avoidance and/or declaratory relief even if the insured had already taken action onshore to recover under the policy (see our earlier article).

That creates an asymmetry. An insured with a disputed claim must first take that to Sanadak³, the UAE’s financial and insurance ombudsman service and then by way of escalation to the Insurance Dispute Resolution Committee (the IDRC) – also administered under Sanadak. The IDRC acts as a first-instance body, and either party can, subject to certain thresholds, appeal its decision to the onshore Court of Appeal⁴. An insurer faces no equivalent constraint and can go straight to the DIFC Courts where the policy contains a “Courts of the UAE/Courts of Dubai” type jurisdiction clause, even in circumstances where the insured has brought proceedings in the onshore courts.

This has created a real risk that the same dispute would be fought twice. That risk brings duplicated costs, different procedural rules on points such as disclosure and expert evidence, and the possibility of two courts reaching opposite conclusions on the same facts. The DIFC Courts themselves have acknowledged this but have reasoned that this is a consequence of agreeing to a non-exclusive jurisdiction clause in favour of the DIFC Courts.

The CJT decision

The dispute arose from a fire at a residential tower in Dubai insured under a Property All Risks policy. The insured parties requested the Dubai Courts’ Centre for Amicable Settlement of Disputes (CASD) to appoint an expert. The insurer then commenced proceedings in the DIFC Court of First Instance, seeking a declaration that the policy had been avoided and cancelled ab initio for material non-disclosure and misrepresentation and, in the alternative, that it was not liable because the claim fell outside cover.

The insured parties unsuccessfully challenged the DIFC Court’s jurisdiction, and the DIFC Court of First Instance held that the policy’s “Law and Jurisdiction: United Arab Emirates” clause was a sufficiently express and clear opt-in to the DIFC Court’s jurisdiction (in line with previous decisions)⁵.

The insured parties then applied to the CJT, which, on 21 September 2026, accepted the application, ruled that the Dubai Courts have jurisdiction over the dispute, ordered the DIFC Courts to cease hearing the claim, and ordered the insurer to pay the insured parties’ costs of the CJT application and a specific sum in respect of legal fees.

Two aspects of the CJT’s reasoning stand out: (i) the basis on which the CJT considered it had jurisdiction to consider the application in the first place; and (ii) the CJT’s reasons for finding that the Dubai Courts, rather than the DIFC Courts, should have jurisdiction over the underlying insurance dispute.

On the first point, the CJT did not require that a conflicting judgment, whether procedural or substantive, had already been issued by the Dubai Courts. It was enough that neither the Dubai Courts (still considering the expert application and the related jurisdictional and arbitration-validity challenges) nor the DIFC Courts (which had already ruled they had jurisdiction) had relinquished the matter before them, giving rise to a risk of final and conflicting judgments between the two courts in future. The CJT also treated CASD, the body before which the insured parties had filed their expert application, as a judicial body of the Dubai Courts for these purposes, a characterisation the insurer did not dispute.

On the second point, the CJT gave two reasons for finding that the Dubai Courts, rather than the DIFC Courts, should have jurisdiction over the dispute:

First, the policy in question did not contain any express and clear provision by which the parties agreed that the DIFC Courts had jurisdiction. The CJT therefore rejected the approach taken by the DIFC Court which had determined that the clause in question was an opt-in to the jurisdiction of the DIFC Courts.
Second, the property insured under the policy is in Dubai, outside the geographical boundaries of the DIFC, and none of the relevant parties had any legal connection to the DIFC.

What next?

Overall, the decision provides welcome clarity on how the CJT, and potentially the USC, will consider similar conflicts in the future, and the CJT’s willingness to rule early, on the basis of a mere risk of conflicting judgments, should spare parties unnecessary delay and cost. However, several important questions remain open:

Will the CJT always favour the onshore courts? Each case turns on its own facts, but it remains unclear whether the CJT views all “Courts of Dubai/UAE” type clauses as insufficient to confer jurisdiction on the DIFC Courts, or whether this clause simply fell short – and whether that distinction even matters where the insured risk is onshore Dubai with no DIFC nexus.
Is the DIFC Court bound by this decision? It is bound in relation to this specific case. However, whether the CJT’s broader reasoning – including its indifference to the insurer’s avoidance claim in the DIFC proceedings – will shape the DIFC Court’s approach to future parallel proceedings is unclear. However, in line with its previous rationale it may consider that it is for the CJT to make decisions on such conflicts, and it cannot pre-empt that by refusing jurisdiction since by doing so it would be taking on the role of the CJT.
What about claims in other Emirates? The CJT can only resolve Dubai/DIFC conflicts, so a parallel claim in, say, the Sharjah Courts would fall outside the CJT’s jurisdiction. This may be a matter for the USC, however, gateway to the USC is not identical to the CJT and therefore questions remain whether the USC would adopt a similar approach and at a similar stage.
Would Sanadak and the IDRC be treated like CASD? The CJT treated CASD as a judicial authority within Dubai without any apparent debate. However, it remains open as to whether Sanadak/IDRC, which is supervised by the UAE Central Bank – a Federal level body, rather than an Emirate-level body – would be treated the same way.

In the meantime, a reference to the “Courts of Dubai” or “Courts of the UAE” should not be assumed to guarantee DIFC access, or indeed to avoid the risk of parallel proceedings. Parties wishing to avoid these potential issues should use a clearly drafted jurisdiction clause. Parties who want a single, predictable forum may also consider arbitration, provided they take steps to ensure the arbitration clause is valid [UAE insurance dispute resolution and arbitration – An update | HFW].

Footnotes

Article 39 and Article 33(5) of Federal Decree Law No. 42 of 2022
Article 14(B) of Dubai Law No. 2 of 2025
In the absence of a valid arbitration clause.
Federal Decree Law No. 6 of 2025, the onshore UAE insurance law, read with the Sanadak and IDRC complaint process.
Article 14(B) of Dubai Law No. 2 of 2025 (the Courts Law).