UAE Civil Code 2026: increased exposure in fatal and serious injury claims

The new UAE Civil Code - Federal Decree-Law (No. 25 of 2025) - effective from 1 June 2026, represents the most wide-ranging changes in decades. This bulletin forms part of Kennedys’ series analysing how selected reforms may affect insurers.

The new UAE Civil Code increases the scope for compensation in fatal and serious injury claims.

Under the current law, where Diyyah (blood money) or Arsh (injury compensation) was payable, it could be treated as a cap to compensation, on the view that Diyyah or Arsh compensated the injury or death itself. Some courts already allowed additional damages, but the issue was dealt with inconsistently by the various Courts of the UAE.

Article 259 of the new Civil Code now provides that:

“In cases where blood money (Diyyah) or injury compensation (Arsh) is due, the court may, upon the request of the victim, award additional compensation if the death or injury resulted in material or moral damages not fully covered by the Diyyah or Arsh.”

Diyyah and Arsh are no longer necessarily exhaustive. Courts are expressly empowered, at their discretion, to award further material and moral damages where blood money or Arsh do not fully compensate the loss. Categories of loss likely to be claimed include loss of earnings, financial dependency, long-term care costs, and damages for pain, suffering and emotional distress.

As a result of this change, the potential implications are:

• Higher quantum: fatal and catastrophic injury claims may now include Diyyah/Arsh plus additional losses, particularly in high-earning, or long-term dependency cases.
• More complex and costly claims handling: as jurisprudence develops, there is likely to be more focus on proving additional losses. Early expert evidence (medical and actuarial) may soon become the norm in high-value cases.
• Short term uncertainty: as the new provision is applied by the Courts, there is likely to be uncertainty as to how the Courts will assess damages beyond Diyyah and Arsh, and how broad the scope for compensation for economic and moral damages will be.
• Policy impact: higher exposure may increase demand for higher policy limits, and consequently higher premiums.

Takeaway: Article 259 moves the UAE away from treating Diyyah and Arsh as a self-contained measure of compensation, and closer towards a more individualized, fact-specific assessment of loss. For insurers and reinsurers, the change increases potential exposure and is likely to result in greater variation in quantum depending on the particular facts of each case.

To discuss these changes and how they will affect your organisation, please contact a member of our team. Stay tuned for the latest updates in this series.