The UAE has a compulsory insurance for employees that is not widely known: the "unemployment insurance scheme", or ILOE (Involuntary Loss of Employment). It costs little, but not joining is fined, and joining on time can provide several months of income during unemployment. This article is based on the unemployment insurance page of the official UAE Government portal (`u.ae`) and the frequently asked questions of the scheme's website, checked on 25 October 2026.
Aim of the scheme
The UAE Government portal describes the scheme as a form of insurance and social security for citizens and residents working in the federal or private sector who lose their job because their employer ends the contract. The five stated aims:
- a safety net for workers and their families until they find a new job;
- income for up to 3 months during unemployment;
- encouraging UAE citizens to work in the private sector;
- raising the competitiveness of Emirati talent and the appeal of the labour market;
- attracting and keeping talent and skilled workers.
Who must join?
The UAE Government portal says all employees of the federal government and the private sector must buy a policy. These groups are exempt:
- investors who own the establishment they work in;
- domestic workers;
- employees on temporary contracts;
- juveniles under 18;
- UAE citizens who meet the retirement conditions, or retirees receiving a pension who have taken a new job.
Premiums
| Category | Basic salary | Monthly premium |
|---|---|---|
| Category 1 | Below AED 16,000 | At most AED 5 |
| Category 2 | Above AED 16,000 | At most AED 10 |
Employees on commission whose contract sets no fixed basic salary may choose either category. The measure is the "basic salary", not the total salary with allowances.
Compensation
| Subject | Stated rule |
|---|---|
| Amount | 60% of the insured salary |
| Duration | At most 3 months per claim |
| Monthly cap, Category 1 | AED 10,000 |
| Monthly cap, Category 2 | AED 20,000 |
| New job | If the insured finds a new job during the entitlement period, compensation stops |
| Payment | The insurer reviews the claim and pays within two weeks of filing |
Conditions for compensation
- at least 12 months of continuous membership;
- all premiums paid according to the chosen schedule;
- unemployment for a reason other than resignation;
- no dismissal for disciplinary reasons under the labour law or the federal human resources law;
- the claim filed within 30 days of the end of employment or of the resolution of a labour dispute;
- no absence-from-work complaint, no fraud or fictitious employer, and the job not lost because of a strike or non-peaceful protest;
- the insured is in the country.
The FAQ of the scheme's website (`iloe.ae`) adds three more points:
| Subject | What the FAQ says |
|---|---|
| Continuity | Cover starts after 12 months, provided there is no interruption in membership of more than three months |
| Policy cancellation | If premiums go unpaid for more than 3 months, the policy is cancelled |
| Overall cap | The insurer's obligation ends on reaching the "maximum aggregate limit" over the insured's entire working life in the UAE; the page does not give the amount |
Filing a claim
| Step | Details |
|---|---|
| 1. Filing | Within 30 days of the end of employment, through the ILOE website, the ILOE app or the contact centre on 600599555 |
| 2. Review | The insurer reviews the claim and responds |
| 3. Payment | Within two weeks of the filing date |
Checking your membership
According to the FAQ, to see your insurance certificate or the amount due: on the ILOE website or app, choose your sector, enter your Emirates ID number and mobile number, request a one-time password and then choose "View Policy Details" or "View Statement".
Fines
| Violation | Fine |
|---|---|
| Not joining the scheme | AED 400 |
| Not paying premiums | AED 400 |
Ways to join and pay
The UAE Government portal lists these channels:
| Channel | Details |
|---|---|
| ILOE website and app | Online joining and payment |
| ILOE contact centre | Telephone support |
| Business service centres | Tasheel and Tawjeeh |
| ATMs and kiosks | Including MBME PAY, C3PAY and UPAY |
| Exchange houses | Including Al Ansari Exchange |
| Some banks' apps | Payment from an account |
| SMS | For du and Etisalat subscribers |
| BOTIM app | Joining and payment |
Two examples
These examples are hypothetical and only apply the official rules above. The premium is assumed to be at the stated cap.
Example 1: an employee with a basic salary of AED 8,000. They are in Category 1 and pay at most AED 5 a month, or AED 60 a year. After two years of continuous membership, the company lets them go in a downsizing, and they file a claim within 30 days.
| Item | Calculation | Amount |
|---|---|---|
| Monthly compensation | 60% × 8,000 | AED 4,800 |
| Category 1 cap | — | AED 10,000; the compensation is below the cap |
| Maximum total for this claim | 3 × 4,800 | AED 14,400 |
If they had resigned or been dismissed for disciplinary reasons, they would have received no compensation.
Example 2: a manager with a basic salary of AED 40,000. They are in Category 2 and pay at most AED 10 a month. 60 per cent of their salary is AED 24,000, but the Category 2 cap is AED 20,000; so the monthly compensation is AED 20,000, and at most AED 60,000 for three months.
Practical points
- If you are an employee and have not joined yet, join; the yearly cost is far below the AED 400 fine.
- Pay the premiums regularly; not paying is fined and also removes the right to compensation.
- Do not miss the 30-day deadline for filing a claim after your job ends.
- This insurance does not replace the end-of-service gratuity; see the article "End-of-service gratuity in the UAE private sector".
- If you own the company you work in, you are exempt from the scheme.
Royal Golden does not give legal or financial advice. This article is general information, and the decision on any membership and any compensation rests with the scheme's insurer and the UAE Ministry of Human Resources.
Sources
- UAE Government portal, Unemployment insurance scheme — https://u.ae/en/information-and-services/jobs/Workplace-regulations/insurance/unemployment-insurance-scheme (checked on 25 October 2026)
- Involuntary Loss of Employment (ILOE) scheme, frequently asked questions — https://www.iloe.ae/Faq.aspx (checked on 25 October 2026)