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Unknown facts of Auto Insurance in Dubai 2020

Written by Huma

First Car Insurance: A Complete Guide for the new buyers in Dubai

Auto Insurance in Dubai is considered to be a serious business and the government has implemented and forgone some laws in order to promote its purchase among the young drivers or whoever possesses a car.

But how much we are aware of these laws and facts associated with these insurance policies?

  1. Things have changed now as owning a car is no longer considered as a luxury. It is considered a necessity in cities like Dubai. 
  2. A car saves the time of transportation for people in cities and it has become important to protect your car and yourself from many situations. 

Thus, it has become mandatory to have insurance for your car. There are some things that you should know that are related to cars. 

It has become legally compulsory for the car owners to have insurance for their cars whether they are buying a new car or they already own the car. If someone is buying a car, they are required to get insurance before registration. 

In all the places in UAE, insurance is available through brokers, banks and insurance companies. In fact, there are a large number of insurance providers in the UAE. This overwhelming amount of insurance providers confuses the car owners as they have so many options to choose from. 

Almost all people have auto insurance in Dubai, but many people know the details about their policy. However, it is important to know all the details about the car insurance you are buying if you want that you don’t get overpaid by the companies. 

It is a known fact that most of the people end up paying more than is required for car insurance. It has become very easy for people to obtain car insurance as companies have started to offer insurance online as well. Hence, it is difficult to know all the details about the insurance that you are buying or have bought.

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It is important that you should have complete knowledge about different insurance policies along with the details about companies that provide car insurance. This knowledge ensures that you get the best insurance policy in the budget that is suitable for you. This article provides you an explanation of unknown facts of auto insurance in Dubai, 2020. Let’s look at some of the facts that are not widely known by people. 

1.Your age matters

People under the age of 25 usually have to pay more to get their car insured. According to UAE law, drivers that are below the age of 25 also have to pay 10% of the total damage if they cause an accident. Thus, this rule even applies if the car is registered and insured with another person that is more than 25 years old.

2. Your car might not be covered

Many people choose third-party liability insurance because it’s a more affordable option, but it only covers the other party’s car. Therefore, you’ll have to pay to fix the damages to your car out of your own pocket if you were responsible for the accident. 

3. You can save money by comparing policies

Don’t make the mistake of purchasing the first car insurance policy that comes your way, or simply renewing with your current provider. Not all car insurance companies will have a policy that matches your exact needs and budget, so be sure to compare multiple quotes from insurance providers on Buyanyinsurance before making the decision. 

You can save a significant amount of money on your car insurance this way. Insurance companies also frequently change their rates to improve profitability. Hence, Your current insurer might have offered you the lowest rate last year but there could be better deals in the market to ensure your specific car this year.

4. Compare the type of Insurance Types

There are different types of insurance that are offered to you. You should know about the dynamics of each type so that you know what type of insurance you are getting. 

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  1. Comprehensive Insurance: This type of insurance covers you and the other car in case of an accident. Because of the wider coverage, this insurance generally tends to be costly. This auto insurance in Dubai covers not only the vehicle against accidents, theft, fire and malicious acts but also personal accidents, in the event that the driver or passengers are injured in a collision and need medical treatment.
  2. Third-party liability insurance: This auto insurance in Dubai covers only the other car and passengers in case of an accident. Thus if you opt for third-party insurance cover, the insurance premium will cost much less but you will have to pay for the damage of your own car in case of an accident. 

Thus, if a car has been purchased using a loan, most banks in the UAE will not allow you to buy third party liability insurance and will require the owner to purchase comprehensive insurance.

5. Your policy can be expanded to cover other GCC countries

This is a must-have for frequent travelers. Not all insurance policies keep you under their umbrella if you step out of your country, but you can choose a car insurance policy that provides coverage across neighboring countries or even the entire GCC.

6. You can leverage a no claims certificate to save hundreds of dirhams or more

Very few policyholders request a ‘No Claims Certificate’ from their insurance provider. If you haven’t made any claims, then you can provide this certificate when you buy a new insurance policy with a different company to get a discount. You can easily save up to 30% on your insurance by doing this!

7. Gather all your documents to get the process started

You are required to present the following documents to the insurance company as proof of identity and driving experience.

  1. Copy of your driving license
  2. Copy of your vehicle registration card (if it’s a new vehicle, you will need to provide a copy of the Pro-forma invoice).
  3. Copy of your passport photo page and visa page

8. ISO ratings

ISO rating program assigns values to vehicles based on the car make, model, car safety ratings, among other things. Then it takes into account real-life loss records for the vehicle. Auto insurance companies are good at fighting risks. They pull your vehicle rating report to determine the risk of insuring your vehicle. The higher your rating, the higher the risk for the insurer to be involved with you, which results in higher premiums.

9. You can ask for roadside assistance: 

You can often request your insurance provider to include roadside assistance in your policy, which can prove to be a lifesaver. If you worry about being stranded in the middle of nowhere, then you should definitely consider this add-on. Simply make a call in case your car breaks down or runs out of fuel and they will send someone to help you.

10. Pulling eligibility reports

Auto insurance companies go for the complete research package. Not only do they double-check your claim, driving, and credit records, but they also have access to reports about your mileage vehicle registration, hidden drivers, property reports, and even your current carrier. Therefore, note that you are required to get auto insurance in Dubai to register your vehicle with your local DMV.

11. Expired driving tickets

It could be hard to remember the last time you got a traffic ticket but asking your auto insurance agent never hurts. Auto insurance companies can pull your records and look at violation dates to verify whether your ticket expired and no longer impact your premium. It’s advisable to keep track of your traffic violation date(s) and reduce possible surcharges for your next renewal term.

12. Auto insurance company’s surcharge schedule

Auto insurance companies are very much informed about your driving records. Depending on the nature of your ticket, they can determine whether you are getting an increase in your auto insurance rate and by how much. In fact, they use your company’s surcharge schedule to gauge the value of your current driving violation(s).

This point-based system shows how much your rates will go up through adding calculation. Thus, to stay ahead of potential increases, ask for a copy of your company’s surcharge schedule.

13. The impact of your claim on your auto insurance rate

It’s difficult for drivers to know how accidents could impact their car insurance rates as surcharges vary by insurer. Even if you try alone, you may find it overly complicated and end up calling your auto insurance for help. Auto insurance companies have access to that information and can determine which claim increases your rate. Know that the number of accidents along with the nature of your claim has an impact on your rate so try to learn more about it.

14. Non-renewal of Auto insurance

Never underestimate the impact of your previous driving violations. Your car insurance has full access to your driving records and can easily determine whether you qualify for a policy renewal or a good-bye note. It all varies from one company to the next, and from state to state. High-risk drivers facing renewal rejections share multiple driving tickets within a time frame, a DUI, license suspensions, exceeding the number of claims, and other traffic violations.

15. Total Loss of Vehicle Calculation

If you are involved in a car accident where your vehicle cannot be repaired, your auto insurance may determine your vehicle is a total loss. There’s no general rule for that as it varies from insurer to insurer. Typically, your insurer will take the cost of your repair and compare it with the current cash value of your car. If the exact total loss exceeds the internal set threshold, your car will be totaled.

16. Auto insurance companies work on their best interest

Your car insurance policy may offer you protection, but your insurer won’t be unconditionally siding with you on every claim. Insurers also act in the best interest of their house insurance because your policy is a legal contract. Auto insurance companies will take your case or claim independently keeping an eye on their balance before any decision is made.

17. Ways to reduce your auto insurance premium

Aside from generating quotes and guidance, auto insurance companies are familiar with discounts that apply to several drivers. Many of them don’t appear on the company’s site but it’s worth asking.

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Auto insurance discounts come in different forms: from having a child in college to having an occupation or affiliation. The list may be long and knowing it all could be hard. Many drivers miss out on hidden discount opportunities for not asking questions. 

18. Claim approvals and exclusions

Your auto insurance knows beforehand which claims are passed and which are rejected. Some examples of claim rejections include intentional damage, damage you do to your own property, damage from road racing, damage by depreciation, and theft of personal belongings during a car accident.

19. Hiring out your vehicle

Whether you use your vehicle to transport people and goods for payment, your insurance company can easily verify your coverage. There’s no way you can skip that infringement. Therefore, if you get into a car accident while hiring out your vehicle, you could be held responsible and forced to pay for the possible damages.

20. You can ask for Emergency Services

Ask about emergency services: In case you have an emergency while on the road like running out of fuel or a flat tire, you can call the emergency number provided on your brand new insurance card for prompt roadside assistance. However, some insurance companies do not provide a 24-hour roadside assistance hotline so be sure to check that before signing up.

21. Check if you have off-road travel insurance 

Generally, car insurance companies in Dubai only cover accidents that take place on the road, but Dubai being an adventurer’s paradise, off-road travel like dune bashing and wadi bashing are quite common. If you will be taking part in these activities, make sure that your insurance covers off-road travel as well.

22. Understand how your premium of auto insurance in Dubai is calculated

Car insurance premiums are calculated after considering the year, make and model of the car, the size of the engine, claims history and risk profile of the driver. In the table below you will find some of the other factors that will affect your insurance premium. For example, a driver with less experience will have to pay a higher insurance premium in comparison to a more experienced and older driver.

There are many factors due to which the level of insurance premium is determined.

  1. If you have a new car that has high safety features, the insurance premium will be low.
  2. If the price of your car is high, the insurance premium will be high.
  3. If the age of the driver is under 30, the insurance premium will be high 
  4. If you have a low driving experience, the insurance premium will be high.
  5. If you have GCC coverage, the insurance premium will be high.
  6. If you would require an off-road coverage, the insurance premium will be high.
  7. If you would require a breakdown coverage, the insurance premium will be high. 

Conclusion

As getting auto insurance is compulsory for the residents of UAE, you have to buy a policy for your car. There are many companies that are providing the insurance. If you want to get the best deal, you should check and know all the facts about the insurance. 

There are many details that the insurance provider may not give you. You should ask about different coverages and policies in order to know what is suitable for you. Hence, there are some points that you should consider while buying insurance. This article has included those points that are not widely known by people but they can have a significant effect on the policy that you are buying. 


    Originally published Jan 29, 2020 14:07:26 PM, updated Jan 29, 2020

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