If you’re a driver in the UAE, you might notice your motor insurance costs creeping up. But what’s the story behind these changes, and how will they affect you? I have the answers to all your questions, so keep reading to find out all the important information you need to know.
Accidents Now Come With A Pricey Side Effect
Getting into an accident might cost more than just the repair bills. Drivers who file claims after an accident are now facing up to 15% higher insurance premiums. Some insurers are even taking it a step further – if you’ve had significant claims, they might ask you to switch from comprehensive coverage to third-party liability when it’s time to renew your policy. Why? Insurers are trying to limit their losses and are becoming stricter with drivers who have higher risk profiles. Meaning – the more you get into accidents on the road, the more you’ll have to keep paying for your mistakes.
The Ripple Effect Of Last Year’s Historic Floods
The record-breaking rains that hot UAE in April 2024 were a turning point for the insurance industry. These were the heaviest rains in 75 years, and the resulting floods caused extensive damage to vehicles, especially in Dubai and the Northern Emirates. Thousands of cars were affected, and insurers had to bear billions of dirhams in losses. As a result, premiums, particularly for electric vehicles, have risen, given their higher repair costs. Insurers are now more cautious when setting policy rates.
Average Drivers To See Minimal Increases
If you’re not someone with recent claims, the impact on your premiums might be minor. On average, motor insurance costs have gone up by 2-3%. According to Avinash Babur, CEO of Insurancemarket.ae, most policies remain relatively stable unless you’ve had an accident or filed a claim recently
So, if you’ve had accidents or drive an electric vehicle, you may notice higher costs when it’s time to renew your policy. Which means shopping around and comparing plans is your best bet to saving money in the long run.
