Understanding Lifetime Annuities for Relatives in the UAE
Ask Gulf News: Can you legally pay a relative a lifetime annuity in the UAE?
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In the UAE, it is legally permissible to pay a relative a periodic life annuity under specific conditions set by the Federal Decree by Law No. (25) of 2025. The arrangement must be documented and can be terminated upon the obligor's death or bankruptcy.
- 01Periodic life annuities can be legally established in the UAE under certain conditions.
- 02The arrangement must be documented in writing to be enforceable.
- 03Annuity obligations can extend for the life of the obligor, obligee, or another person.
- 04If the obligor dies before the obligee, the latter can claim a proportional share of the annuity from the estate.
- 05The obligation ceases upon the obligor's death, bankruptcy, or insolvency.
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In the United Arab Emirates, individuals can legally provide a relative with a periodic life annuity, which is a financial arrangement that ensures payments until the recipient's death. This is governed by the Federal Decree by Law No. (25) of 2025, which outlines specific conditions for such agreements. Key requirements include that the annuity obligation must be documented in writing and can be established for the life of the obligor (the payer), the obligee (the recipient), or another designated individual. Furthermore, the obligation will cease in the event of the obligor's death, bankruptcy, or insolvency. If the obligor passes away before the obligee, the latter is entitled to claim a portion of the annuity that corresponds to the time elapsed until the obligor's death, potentially from the obligor's estate. This ensures that the financial support continues as intended, provided all legal stipulations are met.
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This legal framework allows families in the UAE to provide financial security to relatives through structured annuity payments.
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