UAE: Caused an accident? Motorists have to pay higher auto insurance premiums
Auto insurance rates in UAE increased up to 3 per cent but accident-related claimant drivers are charged up to 15 per cent more.
But some insurance companies ask drivers to move from comprehensive to third-party liability in the event of an increased claim for damage caused by an accident.
Moin ur Rehman, executive director of Unitrust Insurance Broker, said depending on coverage, auto insurers have had their motor policies going up by around 3 per cent or more, he added.
"Expenses for auto insurance go up faster for recent claimants. Rates go up 10-15 per cent if the motorists claim," he said, and that sometimes the same insurer asks the same driver to take third-party policy over comprehensive when renewing the policy because the company suffered huge losses.
Insurance companies raised rates for vehicles – EVs in particular – after record-breaking rains in April 2024 inflicted huge damage on vehicles in Dubai and the Northern Emirates. There were tens of thousands of cars destroyed during the April floods of last year that cost insurers billions of dirhams.
Insurance firms are also being pricier since the rains of April 2024, the biggest in the UAE’s 75-year history, when they were due to massive losses that came with the rains, Rehman said.
‘There have been very slight changes in motor insurance premiums, which so far have increased by around 2 per cent,’ said Avinash Babur, CEO of Insurancemarket.ae.
"In motor insurance industry, very little has changed, the vast majority of policies remain the same," said Babur. Because of its population, which is constantly increasing with every new resident that moves in Dubai, Dubai’s cars have also increased in recent years.
According to the toll gate operator Salik in Dubai, registered vehicles rose 8.7 per cent in the year to 4.3 million thanks to the macroeconomic boom.
The number of vehicles in Dubai in the daytime reached 3.5 million, official data by the Roads and Transport Authority came in November last year. The number of registered vehicles in the emirate increased by 10 per cent in the last two years compared to a worldwide average of 2-4 per cent.
Last week, health insurers raised premiums on health plans up to 20 per cent as they included dental and mental insurance, organ donation and dialysis in the higher packages.
"In general, rates will be revised for individual and companies," Babur continued. "Risk increases are not always sliced-up, because the insurers do price the same in all their offerings where possible."
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