Updated changes to Car Insurance policies in the UAE
There are more cars on the road than ever before, hence the demand for car insurance has grown significantly in the UAE. Although the motor policy regulations do not change every other day it is still very important for you to understand the recent changes to remain updated and to make the most of your insurance policy.
People often wonder how to choose the best car insurance plan, since there are a variety of plans being offered by a big number of insurance companies in the UAE. So in order to get the best insurance deal, you must know what are the new changes and implementations in the insurance industry.
Every day a good number of cars drive across to the neighboring countries. For example, Oman is a favorite destination among travelers in the UAE. Earlier a generic mention of extra coverage in your policy document was sufficient to help you get across the border. But in 2011, a circular issued by the UAE Insurance Authority enacted for all Motor Insurance providers in the UAE to extend this cover only through the Orange Card – Unified Card Insurance. This orange card allows you to travel across borders with ease without any hassles.
Rise in Price Limits for Motor Insurance
On January 1, 2017, UAE Insurance Authorities issued a new regulation with a motor insurance rates scheme, which specified the minimum & maximum premium for Motor Insurance.
The above regulations include the unified motor vehicle insurance policies against the third party liability and loss &damage. It grants the insurance companies the freedom of competition by offering different prices to their customers based on their respective experiences.
Additional premiums, resulting from the costs of ambulance services and medical evacuation to hospitals are included in the tariff. Insurance companies are not allowed to impose any additional prices without a declaration by the UAE Insurance Authority.
The authority retained the maximum premium for policies against comprehensive liability and loss & damage for sedans at 5%.
As per the circular, mentioned are the price limits –
The least premium for a comprehensive insurance policy type for a private Sedan car is set at Dh1,300 and Dh2,000 for 4×4 vehicles.
The least premium for a third-party liability insurance policy for a four-cylinder private Sedan car is Dh750, while the highest amount is Dh1,300.
The premium rises based on engine capacity with a minimum amount of Dh1,300 for an eight-cylinder sedan to a maximum of Dh2,100.
For a four-cylinder 4×4, the lowest and highest premiums are Dh1,000 and Dh1,750, respectively.
Increase in Property Damage Cover
The revised rules came as a great relief to the third-party affected during the occurrence of an unexpected event. The maximum insured amount is increased in case of any damage caused to their property or any physical injury sustained by the third-party.
Free Car Replacement (If Not at Fault)
Earlier in the defined guidelines for the insurance policies, the insured was only eligible to get a replacement for the car if it was included in their policy. However, as per the new insurance rules, if you are not at fault as a policyholder, you are eligible for a replacement car or equivalent compensation by the other party’s insurance provider.
Many of you might not be aware that the authorities offer a one-month grace period to renew your yearly car registration, that means, your car is insured for 13 months instead of 12. The idea here is to utilize this extra month for out-and-out research and find the best car insurance.
Although rules do not change frequently, it’s best to know the recent regulations to avoid unnecessary hassles. When you are buying car insurance in the UAE, consider each option thoroughly before including it in your policy. Many people spend their hard-earned money by overestimating the value of their car(s) in the claim form, therefore, always fine-tune your specifications precisely and reach out to multiple providers to compare the premiums.
Most importantly, as a policyholder, always refrain from law-breaking and fraudulent activities to keep your insurance policy intact.
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