The Insurance Authority of the UAE has introduced a new car insurance pricing for minimum and maximum premiums.
An insurance company has stated that premiums across categories will reduce by around AED 100 to AED 150.
One benefit is that insurance companies will have to arrange an alternative car for the not-at-fault party for 10 days while his/her car is being repaired after an accident. If not, the company will have to pay AED 300 per day to the person involved.
The Civil Liability Vehicles Insurance Policy provides several new benefits to policyholders, including the increase of the amount of compensation per accident for material damage from AED 250,000 to AED 2,000,000 and reparation of the damaged vehicle in the agency’s workshops, if the accident occurs during the first year of its driving.
It also expands the insurance coverage in the civil liability insurance policy to cover the spouse, children and parents, within the limits of AED 200,000.
Last Sunday, the board of directors of the Insurance Authority on Sunday issued the new tariffs, based on the new regulations for unifying motor vehicle insurance policies, which was issued in September 2016. This new tariff system will be effective, starting from January 1, 2017.
The regulations now includes the unified motor vehicle insurance policies against third party liability and against loss and damage.
The system also allows the insurance companies the freedom of competition by offering prices, based on their respective experiences with the customers, on technical or actuarial reasons.
The tariff will include additional premiums, resulting from the costs of ambulance services and medical evacuation to hospitals. The insurance companies may not levy or charge additional amounts, without a resolution by the Insurance Authority.
In accordance with the the table released by the authority, the minimum premium for a third party liability insurance policy for a 4-cylinder private sedan will be AED 750 while the maximum will be AED 1,300. The premium goes up, based on the capacity of the engine’s peak output i.e. horsepower, to a minimum of AED 1,300 for an eight-cylinder motor vehicle, for which the maximum will be AED 2,100.
However, the minimum premium for a comprehensive (full) car insurance policy for a private sedan is fixed at AED 1,300.
For four-cylinder 4×4 vehicles, the premium for a third party liability insurance policy will range from AED 1,000 to AED 1,750. And the minimum premium for a comprehensive insurance policy for a 4×4 car has been set at AED 2,000.