How automotive insurance coverage insurance policies have modified since heaviest rainfall, floods

It’s been a 12 months for the reason that UAE witnessed considered one of its most unforgettable climate occasions, record-breaking rainfall that flooded streets, stranded vehicles, and left 1000’s of residents in search of assist. The nation bounced again to normalcy inside days, due to the fast response from the authorities and the group that got here collectively.

Whereas the floods grew to become one of many biggest challenges the country had faced, it additionally pushed the insurance coverage trade ahead.

Over 100,000 motor claims in days

“The April floods had been one of the crucial unpredictable and unprecedented local weather occasions in current UAE historical past,” mentioned Anas Mistareehi, CEO of eSanad. “We estimate over 100,000 claims were filed throughout the trade, overlaying motor, property, and business.”

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In keeping with insurers, total insured losses had been estimated to be over Dh4 billion and an enormous chunk of that got here from automobiles — vehicles that had been submerged, stalled, or badly broken in floodwaters.

Toshita Chauhan, enterprise head, motor insurance coverage at Policybazaar.ae, mentioned that the floods severely impacted automobiles, particularly in Dubai, Sharjah, and Ajman. “Essentially the most continuously reported damages included engine failures, electrical malfunctions, and brake points,” mentioned Chauhan.

Regardless of the sheer quantity of claims — equal to 6 to 9 months’ value being filed in only a few weeks — insurance coverage suppliers stepped up and managed the coverage requests.

“Many corporations shortly arrange devoted groups to deal with the sudden inflow,” mentioned Chauhan. “Most claims had been evaluated and settled inside three months, which is a testomony to how effectively the trade responded.”

Business stepping up

The floods had been a turning level for the trade and insurers, who realised that local weather occasions like this aren’t uncommon and that insurance policies wanted to evolve.

“Many insurers have now up to date their insurance policies to incorporate climate-related threats as a part of their customary or non-obligatory protection,” mentioned Mistareehi. “This contains weather-related safety add-ons, enhanced motor coverage options, and enterprise interruption protection for business purchasers.”

Chauhan mentioned that demand for complete protection has surged, significantly for pure calamity safety and roadside help. “Shoppers are way more conscious now. They need to be lined not only for the fundamentals, but additionally for occasions like floods.”

“Now, most insurance coverage insurance policies have choices to cowl climate-related injury,” mentioned Mistareehi. “That features flood safety, add-ons for climate injury, and enterprise interruption protection.”

Surge in premiums costs

After the floods, auto insurance premiums increased and costs almost doubled for high-risk automobiles. “Following the floods, insurers revised premium buildings. On common, motor insurance coverage premiums rose by 25 to 30 per cent, whereas high-risk classes like EVs noticed will increase of as much as 100 per cent,” mentioned Chauhan.

Nevertheless, insurers agree that premiums have now stabilised. “The corrections had been needed to make sure the market stays sustainable. Except we witness one other main occasion, we anticipate future pricing modifications to be gradual,” mentioned Mistareehi.

Insurers additionally talked about that pricing now replicate precise threat. “We don’t anticipate additional sharp will increase. The pricing now displays the true threat surroundings, and merchandise have gotten extra personalised and data-driven,” mentioned Chauhan.

Give attention to EVs 

With extra folks switching to electrical automobiles, insurers are tailoring plans for them too. “EV insurance is generally more expensive as a consequence of battery prices and specialised repairs,” mentioned Chauhan. “Nevertheless, tailor-made insurance policies are rising to make sure these automobiles are properly protected.”

She suggested EV homeowners to make sure their insurance policies cowl EV battery alternative and related elements.

Complete protection nonetheless issues

Because the UAE authorities continues investing in drainage infrastructure to cut back future flood dangers, the query of the necessity for full insurance coverage nonetheless arises. Consultants are of the opinion that complete protection stays a clever alternative.

“Floods are only one facet. Complete insurance coverage protects towards a broad vary of unexpected occasions, accidents, theft, fireplace, and extra. It’s a needed safeguard in right now’s local weather,” mentioned Chauhan.

Methods to avoid wasting on premiums

Consultants spotlight how motorists can maintain insurance coverage prices manageable and provide good methods to avoid wasting on increased premiums.

• Sustaining a clear driving document

• Growing deductibles (if financially possible)

• Bundling insurance coverage insurance policies

• Evaluating quotes from totally different insurers

• Shopping for solely from licensed and controlled suppliers

“The secret is to remain knowledgeable and proactive,” mentioned Chauhan. “When customers perceive their protection, they’re higher outfitted to navigate a altering insurance coverage panorama,” added Chauhan.