Motor and Car insurance in Dubai

Motor and Car insurance in Dubai

Duabi expatriates often opt for buying a car while they’re in the UAE. Most worldwide-distributed vehicle models are available in the UAE with approachable prices. The UAE has an extensive highway network linking the 7 emirates. The UAE’s richness in oil allows its residents to sport a luxury car lifestyle. Most long-term residents in Dubai would buy new cars every three years as 3+ year-old cars are harder to insure. Nevertheless, car insurance in Dubai is a must.

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Every car on the road in Dubai (and the UAE) must be insured. Uninsured drivers may be liable to paying huge fines if they cause accidents. Uninsured drivers who cause fatal accidents are liable to pay diyya which are paid in cash and decided by special courts. If you fail to pay, jail awaits you. Cars must be also registered before driving. Uninsured cars cannot be registered. Since 2010, Dubai government has allowed some car insurance companies to register your car on behalf of customer’s while they’re finalizing car insurance agreements.

Driving in the UAE

Any adult in the UAE (nationals and residents alike) is eligible to apply for driving license. Nationals from these these 36 countries are allowed to convert their foreign driving licenses into UAE licenses immediately after obtention of UAE residence permit. All other nationals are required to take classes and necessary tests from authorized driving schools before applying for a license.

Types of car insurance in Dubai

  • TP (Third Party): you are only covered for damage to your vehicle if there is another party at fault, and they are insured, and a claim can be made against them. Fire and theft are excluded.
  • TPFT (Third Party, Fire & Theft): This is the legal minimum you are required to have. It is usually the cheapest. As mentioned earlier, this insurance won’t cover car damage only in few cases.
  • Comprehensive or Fully Comprehensive (basic level): Dubai car insurance companies are required by law to provide this at maximum price level of about 3-5% of the value of the car. It covers damage to your own car but be careful of any loopholes in your insurance contract.
  • Comprehensive (with options): It will cover extra cost such as dealer repair, free hire car, free insurance in Oman and other GCC countries, recognition of no claims bonuses (either UAE and/or from overseas). You will 3-10% of the value of the car depending on company and no claims bonus.
  • Comprehensive (premium level): Usually there are some restrictions on who can buy this level of insurance. Expect to pay an extra 1 or 2% of the value of the car.

Bonus: Make sure to consider these when before you sign your car insurance contract in Dubai:

  • If you have driven for a considerable time abroad without making any accidents, bring an original no claims bonus certificate with you (if you have one). It’s referred as No Claims Discount (NCD). Usually, it’s worth 0-40% discount on the normal rates.
  • Shop around for few contract and companies before you settle on one or try car insurance valuator – Souqalmal.
  • If you have connections at your chosen insurance company, make good use of your wasta-reaching skills.
  • Under-25 year old males driving fast sport cars won’t get away with an insurance fee of less than 15% of the value of the insured car.

Car insurance required documents

Insurance companies require proof of identity, driving experience and vehicle details. If the car is registered in your name you need to submit:

  • Copy of your driving license
  • Passport copy (main page and visa page)
  • Copy of the Vehicle Registration card or if it is a new car that has not been registered yet, a copy of the (pro-forma) invoice, or customs clearance documents declaring the vehicle details.

Remember that since 2010 Dubai government has allowed some insurance companies to register your car on your behalf.

Since October 2014, motor insurance companies have a shared database to determine insurance premium (comprehensive) based on the accident history of the motorist.

Can you cancel my policy at any time?

You can only cancel your policy when you transfer the ownership of your vehicle or if you de-register your vehicle. Every insurance company has its own rules when it comes to refund if your contract is still valid.

All additional coverage (typical with comprehensive packages) have financial limits specified by the insurance companies. Make sure you aware of this by reading the terms & conditions on the insurance policy.

Article Name
Motor and Car insurance in Dubai
Everything you need to know about getting car insurance in Dubai, including the legal requirements and the type of policies.