What are the types of Car Insurances in UAE?

Car insurance premiums have become dearer over the years. It is not just about insuring your car with a plan that is within your budget, but also finding one that best suits your needs. You should consider your driving history, preferences, lifestyle and experiences, among other factors to determine the type of coverage that befits your case. The types of car insurance available in UAE are given below:

• Third Party Liability Insurance: As per the UAE Insurance Authority, a motorized vehicle (with specifications as per policy) must at least have a Third-Party Liability Insurance. The Third-Party Liability insurance is the cheapest kind of policy that you can purchase. As the name suggests, it covers only damages to property or bodily injuries to a third party caused by your car. As a result, you would have to pay out of your own pockets for any repair costs to your own car. In the case where the damage is caused to your car by a third-party, then you can only hope that their insurance covers damages done to you. Although it is not suggestable to opt for this kind of insurance as it offers only bare minimum cover, if cost is your sole concern, then you need not look further.

• Third Party Liability Insurance with Fire and Theft coverage: This type of policy is pretty much the same as the above mentioned one, with the exception that it includes coverage against cases of fire or theft. This type of policy is also marginally expensive.

• Comprehensive Insurance (basic): This is a complete package offered by an insurer and offers a wider protection. It not only covers damages to a third party but also the ones to your own car and other bodily injuries. It also includes cover for other unprecedented events such as fire, theft, lightning, natural calamities, damage from an animal, etc. A comprehensive package offers better value for money and it is usually charged at a maximum of 5% of the car value.

• Comprehensive Insurance (with add-ons): Along with a basic comprehensive plan, there are many other unfortunate events that insurance companies offer coverage for. These are termed as add-ons and you may pick the ones that best meets your interests and subsequently pay a small additional price for it. With add-ons, the price of your insurance plan might be around 3-10% of your car’s value. Some of the add-ons are…

  • Off-road cover: If you frequently take off to the desert and are in an un-marked road, then this add-on is something you should definitely opt for. However, these are often only offered for cars that have a 4-wheel drive or an owner who possesses an off-road license.

  • Road assistance: While you are on-road, there are chances that your car may experience break-downs, fuel shortage, lockouts, flat-tires, etc. In such cases the Road-assistance add-on covers cost incurred for mechanic or towing services.

  • GCC -countries: If you frequently travel around the GCC-countries in your car, then this add-on is a must. In fact, you cannot enter Oman without an insurance coverage such as this one.

  • Agency-repair: Your local repair shop may fix up your car for a lower price, but if you prefer that the authorized dealership of your car (who usually quote higher prices for spare parts and repair work) fix your car, then this add-on would be apt.

  • Car rentals: During the period when your car is being repaired, if you wish to rent another car, then the insurer would pay for those expenses if you purchase the ‘car-rental’ add-on

  • Some of the other add-ons worth mentioning are Zero-depreciation, personal-belongings cover and multiple riders cover

• Premium insurance: If your car is your prized-possession and you hold it really close to your heart, then you should most definitely choose the Premium insurance policy. Insurers typically provide this type of insurance for their premium customers who own swanky sports car of exclusive luxury cars. This is the most expensive type of policy and costs 1-2% more than other policies. It covers almost all possible cases of unexpected events discussed above.

Secure yourself, your car and your loved ones by purchasing a car insurance. Do keep in mind that Insurers are stringent against claims that involve driving under influence, deliberate accidents and false claims. Read our article factors impacting car insurance premiums to know how you can minimize the price you pay to insure.