Car Insurance FAQs in UAE – All Your Questions Answered

Whether you're buying a new car, renewing your policy, or simply trying to understand how car insurance works in the UAE, you’re not alone. Drivers across Dubai, Abu Dhabi, and the rest of the country often have similar questions — from coverage limits to add-ons and claims.

To make things easier, we’ve collected the most clear and useful answers in one place.

Most Common Car Insurance Questions & Answers

1. What is a No-Claim Discount (NCD)?

A No-Claim Discount is a reward for driving safely. If you don’t make any claims in a year, insurers reduce your next premium. In the UAE, the NCD can reach up to 20% depending on the insurer.

2. Does UAE car insurance cover international driving?

Standard car insurance UAE policies don’t cover international driving. However, many insurers offer Oman cover as an add-on. For other countries, you may need a separate international policy.

3. What add-ons can I choose with comprehensive insurance?

Popular add-ons in car insurance Dubai include —

Agency repair
Roadside assistance
Oman extension
Replacement car
Personal accident cover
Off-road coverage (for 4x4s)
Natural disaster (acts of nature) cover

Add-ons vary by insurer.

4. Does my insurance cover off-road driving?

Not always. Off-road coverage is usually an add-on, especially for SUVs. Check your insurer’s terms, as coverage varies for desert driving and dune bashing.

5. Can I transfer my car insurance to a new owner?

Yes, car insurance in the UAE can sometimes be transferred when the car is sold — but the new owner must meet the insurer’s eligibility criteria. Some insurers may refuse transfer for older cars and offer a new policy instead.

6. Can I cancel my car insurance policy?

Yes, you can cancel your car insurance UAE policy before its expiry. However, this is possible only under specific conditions set by the UAE Central Bank. Cancellation is allowed if —

The vehicle licence is cancelled
A new insurance policy is issued because vehicle details changed OR
The vehicle ownership is transferred to someone else

When you cancel, the insurer refunds the remaining premium after deducting the applicable short-rate percentage — as long as there have been no paid or outstanding claims caused by you.

7. Are natural disasters covered under car insurance?

Comprehensive car insurance UAE plans can cover natural disasters like floods, storms, and sandstorms. This, however, is usually available as an add-on.

8. Is agency repair better than garage repair?

Agency repair means your car is repaired at the official manufacturer’s service centre, which generally offers genuine parts and better quality. Garage repair is cheaper and available at network garages. For new cars, agency repair is highly recommended.

9. How quickly can I get my car insurance policy?

If you buy online, you can get your policy within 10–15 minutes after document verification and payment. Many insurers issue digital policies instantly.

10. Can tourists buy car insurance in Dubai?

Yes, tourists can buy car insurance Dubai plans, especially when renting a car. Rental companies include basic third-party insurance. If you are driving your own car shipped from another country, you must buy temporary UAE insurance before driving on the road.

11. Can I get insurance without a UAE driving license?

No, you cannot get standard car insurance UAE coverage without a valid UAE driving licence. Insurers require a local licence to process the policy, verify your driving eligibility, and calculate the correct premium. If you’re new to the country, you must first convert your foreign licence to a UAE licence before purchasing a full policy.

12. How long does policy activation take?

Most insurers issue your policy within a few minutes once documents are verified. When you purchase through Policybazaar.ae, activation is usually instant (generally 10-15 minutes). The digital policy arrives in your email shortly after payment.

13. Can I insure a used car?

Yes, used cars can be insured in Dubai and across the UAE. Depending on the car’s age and condition, insurers may offer either comprehensive or third-party coverage. Cars under 7–10 years old usually qualify for comprehensive insurance.

14. Can I buy monthly car insurance?

Monthly motor insurance is not common in the UAE. Most policies are issued for 12 months. Some insurers may offer short-term cover for specific cases, but it is usually limited to businesses or special approvals.

15. What is the legal minimum coverage?

The legal minimum in the UAE is Third-Party Liability (TPL) insurance. This covers injuries or property damage caused to others. You cannot register or drive a car in any emirate without at least TPL coverage.

16. Can I upgrade from third-party to comprehensive insurance?

Yes, you can upgrade to comprehensive car insurance UAE anytime, as long as your car meets the insurer’s eligibility criteria. Many people upgrade during renewal or when their car is still within the acceptable age bracket.

17. Is online insurance cheaper than agents?

Online plans are usually more affordable because you can compare multiple quotes instantly. Platforms like Policybazaar.ae often offer exclusive online prices, discounts, and deals that are not available through offline agents.

18. Do I need insurance before vehicle registration?

Yes, you must have an active car insurance UAE policy before registering your vehicle. The RTA system will not process your registration without valid insurance details.

19. Can financed cars be insured?

Yes, financed cars can and must be insured. Banks and finance companies usually require comprehensive insurance to financially protect the vehicle until the loan is fully repaid. You can still compare and choose your insurer freely.

20. What are the maximum third-party coverage limits?

Under UAE law, third-party car insurance covers unlimited liability for bodily injury (as per the orders of the court or other valid authority) and up to AED 2 million for third-party property damage. These limits are standard across all insurers as per the Unified Motor Policy.

21. How is electric vehicle insurance different?

Electric vehicles can be insured like petrol cars. However, insurers consider factors such as battery replacement cost, specialised repair centres, and technology. EV insurance may have slightly higher premiums, but coverage benefits remain similar under car insurance UAE rules.

22. Can imported or classic cars be insured?

Yes, imported and classic cars can be insured. But insurers may offer limited options or require valuation reports. Comprehensive coverage for older or classic cars may be restricted, depending on the vehicle’s age and parts availability.

23. Do car modifications affect insurance?

Yes, modifications such as performance upgrades, custom paint, body kits, or exhaust changes can increase premiums or limit coverage. You must declare all modifications to the insurer. Otherwise, car insurance claims may be rejected.

24. Can multiple drivers be insured?

Yes, you can add multiple named drivers to a car insurance policy. Premiums may increase depending on each driver’s age, experience, and driving history.

25. Is engine damage covered?

Engine damage is covered only if you have comprehensive insurance and the damage is caused by an accident. Damage due to negligence — such as driving through deep water or lack of maintenance — is usually not covered.

26. Are dents and scratches covered?

Minor dents and scratches are covered under comprehensive insurance if they result from an accident. Everyday wear-and-tear or cosmetic scratches without an incident are not covered.

27. Does car insurance in UAE cover hit-and-run accidents?

Yes, comprehensive car insurance UAE covers hit-and-run incidents, as long as you obtain a valid police report. Third-party insurance will not cover damage to your own car.

28. Is towing included in my car insurance UAE?

Many comprehensive motor insurance policies include towing as part of roadside assistance. Some insurers offer it as an add-on. Third-party insurance may also include towing benefits, subject to add-on conditions.

29. Are belongings inside the car covered?

Personal items inside the car are not covered by standard car insurance. You may need a personal belongings add-on if you want protection for laptops, bags, or valuables. You can check the availability of this add-on with your insurer.

30. Is windshield damage covered under motor insurance?

Yes, windshield and glass damage are covered under comprehensive car insurance. Some insurers offer a windshield cover with no deductible, while others apply a small excess.

31. Are tires insured in car insurance?

Tyres are generally not covered unless they were damaged during an accident. Wear-and-tear or punctures from regular use are excluded.

32. Are weather-related accidents covered?

Weather-related incidents such as floods, storms, or sandstorms are covered only under comprehensive car insurance. This is true only if you have an optional add-on for ‘natural disaster’ or ‘acts of nature’ in your comprehensive policy. Third-party insurance does not cover any damage to your own vehicle caused by weather.

33. Is fire damage covered in motor insurance?

Yes, fire damage is covered under comprehensive policies, whether the fire is accidental or due to electrical failure. Third-party insurance does not cover it.

34. Is vandalism covered?

Yes, vandalism is covered under comprehensive insurance as long as you file a police report. Scratches, broken windows, or deliberate damage all fall under this benefit.

35. Can I make a car insurance claim in the UAE without a police report?

No. In the UAE, a police report is mandatory for all accident-related claims. Insurers cannot process repairs or compensation without it.

36. Will I lose my No-Claim Discount (NCD) after a claim?

Yes, your NCD may be reduced or removed if you make a claim. Some insurers offer NCD protection add-ons that allow you to keep your discount even after one claim.

37. Can I choose my repair garage?

With comprehensive insurance, you can choose between agency repair and network garages. If you prefer a specific workshop, you may need to check whether it is listed in the insurer’s approved network.

38. Am I covered if the accident is my fault?

Yes, comprehensive insurance may cover your car even if the accident was your fault. Third-party insurance will only cover the other party’s damage, not your own.

39. Is there a limit to how many claims I can file in a year?

There is no fixed limit on the number of claims, but insurers may reassess your premium or NCD if you make frequent claims. Excessive claims can also affect future policy approvals.

40. Is a deductible required in car insurance in UAE?

Yes, most policies under comprehensive car insurance in UAE include a deductible (also called excess). This is the amount you pay out-of-pocket for repairs after an accident. The deductible amount is fixed in your policy. The amount varies based on your car model, driver age, and insurer rules.

41. What happens under motor insurance if both drivers are at fault?

If both drivers share fault, the UAE police report will reflect the percentage of responsibility for each party. Motor insurance companies settle claims based on this split. Comprehensive policies will repair your car regardless, while third-party policies only cover the other party’s damage.

42. Can I track my car insurance claim online?

Yes, most insurers allow online claim tracking through their website or mobile app. If you buy your policy from Policybazaar.ae, the team also updates you on claim progress and coordinates directly with the insurer and repair garage.

43. What does “total loss” mean in motor insurance?

A total loss means the vehicle is damaged beyond economical repair — usually when repair cost exceeds 50%–60% of the car’s market value. In such cases, the insurer pays the market value of the car, as defined under the UAE Unified Motor Policy.

44. Does car insurance in Dubai cover accidents caused under DUI?

No. Driving under the influence (DUI) voids your coverage. Insurers can reject your claim and may legally recover any payout made to third parties from you.

45. Can a motor insurance claim be rejected in the UAE?

Yes, claims can be rejected if policy terms are violated. This could be DUI, unlicensed driving, undeclared modifications, or providing incorrect information. Claims without a valid police report may also be denied.

46. What documents are required to file a car insurance claim?

Generally, you need the police report, your Emirates ID, driving licence, vehicle registration (Mulkiya), photos of the damage, and your policy details. Some insurers may ask for additional documents depending on the nature of the claim.

47. How does the stolen vehicle claim process work under car insurance in UAE?

First, file a police report immediately. Next, inform your insurer and submit the report along with your car documents. The police will conduct an investigation before issuing a final clearance. After that, the insurer processes the claim and compensates you based on the car’s market value.

48. What is policy excess in motor insurance?

Policy excess (or deductible) is the fixed amount you pay when making a claim. For example, if your excess is AED 500 and your repair cost is AED 3,000, the insurer pays AED 2,500. The excess does not apply to third-party liability claims.

49. Does motor insurance cover all drivers using my car?

Motor insurance covers only those drivers who are licensed and permitted to drive the vehicle. The UAE Unified Motor Policy allows any person to drive the car with the insured’s permission, provided they have a valid licence. However, insurers may require additional drivers to be declared.

50. Can visitors or tourists drive my car under car insurance in the UAE?

Yes, visitors can drive your car if they hold a valid international or home-country licence accepted in the UAE. However, always check with your insurer, as some insurers require tourist drivers to be listed on the policy.

51. Is a digital motor insurance policy valid in the UAE?

Yes, digital policies are fully valid. RTA, police, and all UAE authorities accept electronic motor insurance documents. You don’t need a printed copy as all systems are integrated with insurers.

52. Are there safe driver discounts under car insurance in UAE?

Yes. Many insurers offer No-Claim Discounts (NCD) to safe drivers. If you don’t make any claims for a full year, you can get a discount on your premium. When you buy or renew your policy through PB Advantage on Policybazaar.ae, you can get up to 30% safe driver discount. This is the reward for maintaining a clean driving record along with exclusive savings and support.

53. Are there special discounts for women drivers in car insurance?

There is no official or guaranteed women-specific discount under car insurance in UAE. As per leading insurance platforms, gender does not directly impact motor insurance premiums. In other words, rates are calculated mainly from driving experience, accident history, age, car type, and coverage level, not gender.

54. Do insurers offer GPS-tracking discounts under motor insurance?

No, most insurers in the UAE do not offer direct discounts just for installing a GPS tracker in your car. While GPS devices can help with theft recovery and safety, they are not recognised as a standard discount factor under motor insurance pricing in the UAE. .

55. Is battery breakdown covered under motor insurance?

Battery jump-starts are generally covered under roadside assistance in comprehensive motor insurance plans. However, the actual battery replacement cost is usually not covered unless your insurer offers a special add-on.

56. Does motor insurance cover lockout assistance?

Yes, many insurers include lockout assistance as part of roadside services. If you accidentally leave your keys inside the car, support teams can help unlock the vehicle safely.

57. Can I transfer my No-Claim Discount (NCD) when switching car insurance in UAE?

Yes, your NCD can be transferred to a new insurer when you renew or switch your car insurance in UAE. This is because the discount is applicable to you, not the vehicle. However, you must provide proof of your previous claim-free history, usually through an NCD certificate.

58. What happens if my motor insurance coverage lapses?

If your motor insurance expires, you cannot legally drive or renew your vehicle registration. Driving uninsured can lead to fines, black points, and car impoundment.

59. How long does it take to get a refund after cancelling motor insurance?

Refunds might take 7–14 working days, depending on the insurer. The refund is issued only if there are no active claims and cancellation conditions are met.

60. Can I modify my motor insurance policy online?

Yes, many insurers allow online updates such as changing personal details, adding drivers, or upgrading coverage. Some modifications may require approval or additional documents.

61. How is my car’s value calculated in car insurance?

Insurers calculate your car’s value based on its make, model, year, mileage, condition, and market trends. Some companies use approved market valuation guides, while others use internal pricing tools to estimate current value.

62. Why do premiums increase after filing a claim?

Premiums increase after a claim because insurers view you as a higher-risk driver. Claim history affects future pricing. Furthermore, you may lose your No-Claim Discount (NCD), resulting in a higher premium during renewal.

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