Vehicle insurance is a type of personal insurance which protects from losses incurred from vehicle damage. Dubai is a fast growing city and there is an incredible growth in the insurance industry of Dubai in recent years. Dubai’s Insurance Policies are mostly same as the other Western Countries. Dubai has a number of insurance companies mostly comprising of small and local companies. Among the various insurance policies offered by these companies car insurance is the most common insurance policy.
Legal requirement of vehicle insurance
In Dubai one has to insure the vehicle first in order to get the vehicle registered and to drive in Dubai. Thus, at least a third party insurance is a must to serve the legal requirement in Dubai in which the vehicle is only insured and not the driver. In absence of valid vehicle insurance one has to bear the entire loss due to damage caused to others or to the vehicle.
Insurance Amount And Premium
In Dubai the amount of insurance is mainly dependent on the model of the vehicle. The things which are generally considered by the insurer are the price, year of manufacture and the chassis number of the car. A deal with 4% to 8% rate is a considerate one.
Huddles in vehicle insurance
There are number of insurance companies throughout Dubai and here it is the personal opinions which should be considered before choosing one. Insurance is expensive for sports, fast and luxury cars. Insurance for drivers below 25 years is also very expensive. Cars older than 5 or 7 years also find it difficult to get a comprehensive deal. One should not expect to get an insurance cover in cases of car crash due to driving in drunken state.
Types of Vehicle Insurance
- TPFT (Third Party, Fire and Theft) – It is the least of the legal requirement and is also the cheapest one. Under such type of insurance the company only pays the losses due to the damages caused to other or their vehicle.
- Fully Comprehensive (basic level) – Under such type of insurance the company pays for the damages of one’s own car but also carries with it lots of limitation, restrictions and exclusions. Law requires the insurance companies to provide such insurance at a certain price range of about 3-5% of the car cost.
- Comprehensive with options – such type of insurance cost some extra generally comprising of 3-10% of the car price and include options like dealer repair, free insurance in Oman and other GCC countries and recognition of no claims bonuses.
- Premium level Comprehensive – this is more costly insurance than the previous one and can cost a extra 1 to 2% of the car price. But this insurance cannot be bought by all as it has some restrictions.
Ways to get reasonable vehicle insurance
- Online Insurance Purchase – buying insurance online cost lesser to the companies thus they offer discounts on online purchase.
- Shopping around – comparing various product to get a best deal is always recommended.
- Full payments – avoidance of payments in installments and making full payments attract discounts from the insurance companies.
- Clubbing of products – companies offer discounts on purchase of more than one product like purchasing of health insurance along with vehicle insurance.
- Low Annual Mileage – Keeping annual mileage low is yet another way of keeping premium low and getting discounts.
- Car Alarm – installation of car alarm fetch an additional discount in comprehensive insurance.
- Proper valuation of vehicle – over valuation of vehicle would mean increase in premium. So, right valuation of vehicle is important.
- Advanced Driving Test – An advanced driving test may fetch an additional discount as it shows the company ones driving skill.
- Third party insurance – in cases for vehicles which are cheaper and older third party insurance is the best choice.
- High credit rating– High credit rating means lower rates of premium.
- Good driving record– a clean and clear driving record is an additional advantage for obtaining insurance.
- No claims discount certificate – companies offer discounts for no claim discount certificate and a discount up to 75% can be obtained on obtaining a no claim certificate for a term of 5 years.