Dubai: The Abu Dhabi health insurer Daman has launched its ‘Gratuity and Employee Benefits Trust’ to allow companies to manage end-of-service liability for their expat employees.
UAE employers can fund their EOS liability via a ‘purpose-built trust’ instead of managing these through their business cashflows, which ‘typically’ is the model mostly used until now.
With the Daman trust launch, the employee’s EOS benefits are held in a ‘ringfenced account’ providing for built-in protection.
A 'savings plan' for employees too
Employers can also offer a separate personal savings plan as part of the Daman GEB Trust, giving employees options to allocate a portion of their salary to it and enabling them to manage their personal savings. These can be done in a choice of investments provided from global asset managers through online access.
"The Daman GEB Trust is an exciting first step beyond the health insurance market for us, as well as the culmination of a 15-month journey to develop the product, which fills a growing gap in the market," said Khaled Ateeq Aldhaheri, the acting CEO of National Health Insurance Company (Daman). "We are delighted to be partnering with renowned global financial services group Praxis and look forward to leveraging their existing expertise to administer the trusts.”
UAE'S 6 MILLION EXPAT WORKFORCE
There are over 6 million expatriate workers in the UAE, with a sizeable majority employed in the private sector and therefore eligible for EOS benefits from employers. Globally, the trend is moving towards 'defined contribution' schemes and mandatory provision by external providers.
UAE's pension reforms
The UAE's reconfiguring its decades-old end-of-service benefits schemes and how those funds are deployed through pension funds. Already, this is how it's being done at many public sector organisations. In time, this will, analysts say, lead to widespread take up of planning and hands-on management by employees in how their gratuity funds are used.
