The Different Types of Car Insurance

If you’re buying a new car or looking for car insurance, you should understand the common types of coverage available for a car insurance policy in Dubai. There are various types of car insurance coverages available to help protect your car, passengers and yourself if you’re involved in a car accident.

If you are buying car insurance in Dubai then you must understand that majorly there are two types of car insurance policies available to you. But the coverage provided is something you will want to look into in more depth.

Let’s have a look at various types of car insurance available to you when buying insurance in Dubai.

Comprehensive Car Insurance Policy:

This is an insurance policy to protect you against third party loss/damage as well as your own. This covers the loss/damage/loss that occurs due to burglary, fire, external explosion, accidental collision, lightning, self-igniting, theft and even if a third party commits a malicious act. A legal obligation exists for insurance companies to provide this policy at a maximum price of 3%-5% of the car value. When buying this type of car insurance you must thoroughly go through the documents to make sure every detail is being shared with you correctly.

Typically comprehensive insurance policy covers theft, profanation, fire, natural disasters (like a hurricane) falling objects, damage done to your car by animals, some kind of civil disturbance (like a social riot that results in damage to your car).

In order to know exactly what is covered and not covered, consult with your insurance provider.

Third-Party Liability Policy:

This is very basic coverage that is obligatory by UAE law. This covers death or bodily injury to any third party including property damage caused by the insured party’s vehicle. This policy does not cover any loss or damage to your own vehicle unless the blame lies on the other party in which case you will have to claim from their insurance provider. Fire and theft claims are not covered under this policy. Therefore, if you are looking for more coverage options than you should explore other insurance policies.

Must Read: Should I purchase comprehensive or third party car insurance?

Third-Party Liability Insurance (Theft and Fire Coverage Included):

This is an additional add-on that covers theft and fire clauses that are not taken into consideration in a basic third party liability insurance. If the basic third party liability insurance only offers coverage to third party damage, then you can include add-ons like theft and fire coverage. Please note that this add-on increases the premium cost.

Comprehensive Car Insurance Policy with Add-ons:

This covers all of the above and provides you with options to get extra care. By paying an extra amount, this insurance offers to add ons such as dealer repair, free hire car, no-claim bonuses and free insurance in GCC countries. The estimated amount is 3%-10% of the car value which depends on the company and if a no-claim bonus is availed.

Premium Comprehensive Policy:

As the title suggests, this is the topmost insurance policy in the UAE and covers almost everything that you might need in your car insurance policy. Generally, this policy is offered to limited clients with sports or other luxury cars. Only a few chosen clients can avail of this type of policy by paying 1% or 2% extra. If you own a luxury car then this is the insurance policy you must explore since it gives you extensive coverage for your vehicle.

Now that you are familiar with all types of car insurance available in the market, it is time we take a look at some basic assessment criteria for premiums.

If you are below 25 years of age, you might be subject to higher insurance rates. The insurance rate also depends on the car’s brand, model and year. If you want to insure sports, luxury or older cars (more than 5 years) then the car insurance policies can cost you more than average.

It is best to go through each car insurance policy and the coverage it has to offer. And obviously, you should also keep in mind your car brand, model and age. There are a number of car insurance policies available in the UAE insurance market but you must choose wisely since it is a long term investment of your hard-earned money.