Latest Changes in Car Insurance Policy in UAE That You Should Know

By
  | Published: 25 April 2019 | Last Updated On: 14 January 2021

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The insurance authority of the UAE had made some mandatory changes in the auto insurance policy and a new tariff system. As per the new set of rules, there is a hike in the car insurance premium that you have to pay the car insurer. However, this is not the only thing that is changing but there are some other policies have also been changed.

Impact of the New Car Insurance Policy

  • Accident Coverage Extended To Family Members: According to the old guidelines of the car insurance policy, in an event of an accident, only the policyholder used to cover not the family members unless there was an add-on of family member coverage in the policy. But as per the new guidelines, family members such as wife/husband, parents, and children are covered under the insurance policy.
  • Rise in the Third-Party Coverage: As per the new guidelines, the third-party insurance coverage has been raised to 2 AED million from previous 250000 AED.
  • Free Replacement of Car For Not At Fault Party: As per the old guidelines, if your car gets involved in an accident then you will be offered a replacement car if the insurance policy covers it, irrespective of the party at fault. But as per the new set of rules, if you are involved in an accident and you are not at the blame then only you will be provided with a replacement or compensation equals to the replacement by the other party’s car insurer. Please keep in mind that the maximum replacement period is 10 days and the maximum compensation is AED 300 per day.
  • Additional Fees: According to the new guidelines of car insurance, policyholders can’t demand additional fees such as ambulance fees etc.
  • Separate Quotes: As per the previous car insurance policy, the comprehensive car insurance policy covers third-party liability as well as own damage. But as per the new guidelines, car insurer can apply separately and get quotes for third-party liability and coverage for own damage. In fact, you can buy them from different car insurance providers.
  • Precise Rule on Declaring a Car a Complete Loss: As per the new car insurance guidelines, if the vehicle’s chassis has been completely destroyed then the car insurance provider will not repair the car. Instead of that, the car insurer will provide a replacement with a new car or the amount of the car as per the current market value.

Effective Ways to Overcome the Increase in Car Insurance Premium:

  • Compare Car Insurance Before Choosing: It is advisable that you compare car insurance in Dubai to opt for the best insurance policy for your vehicle. There are several websites that enable you to compare auto insurance policies online between multiple moto insurance companies available in the market. So, compare the insurance policies in terms of their coverage, benefits, inclusion, and exclusions. After that, opt for the one that meets your insurance needs.
  • Cheaper Car, Cheaper Insurance Policy: Not all cars are built the same and thus the car insurance premium varies from car to car. Insuring luxurious car is expensive than the basic car. So, choose your car wisely since the insurance premium is based on the value and model of the car.
  • No Claim Bonus Discount: If you have not claimed insurance for 1 year then you will definitely get a discount on your car insurance premium for maintaining an accident-free record. So, drive safely as it will be beneficial for you in all ways.
  • Avoid Add-On Packages: Car insurance companies offer a few add-ons such as GCC coverage, off-road coverage, Oman extension cover and much more. If you don’t want to increase your car insurance premium then you can certainly avoid add-on packages if it is not required for you. Else, you can opt for them if you don’t mind paying an extra insurance premium for it.

Final Verdict!

By considering the aforementioned guidelines, we can say that even if there is a hike in car insurance premium, the ‘Insurance Authority’ has ensured that the new guidelines are justified for both the policyholder as well as the car insurance provider.