InFocus | Auto Loans Insurance
Insure to ensure your safety
With a number of insurance policies to choose from, surveying the market and asking plenty of questions will help you make the right choice.
- By Shikha Mishra, Staff Writer
- Published: 00:00 August 19, 2006
- Image Credit:
With a number of insurance policies to choose from, surveying the market and asking plenty of questions will help you make the right choice.
"Motor insurance is a mandatory requirement in the UAE when purchasing a car or obtaining a driving licence. This is a major benefit for all drivers as the Government wants to protect all motorists when they get on the road," says Mark Cooper, Business Development Manager, Royal & Sun Alliance.
When buying motor insurance, the best thing to do is approach a professional insurance broker who can guide you through various types of insurance and covers available. "The broker will also be able to highlight the exclusions and limitations of the policy. If you can't go to a broker, listen to the advice of someone who might have had a good experience with an insurer. Ideally one must rely on professional advice," says Mustafa O. Vazayil, Executive Director, Gargash Insurance.
The motor insurance policy (termed unified motor policy) is the minimum cover available for comprehensive and third party risks as per the law.
"This cover has its limitations in various areas including the limit of third party property damage. Some select insurers have amended to extend this cover further — such extensions differ from insurer to insurer and your best bet is to seek professional advice," says Vazayil.
Motor insurance in the UAE market is limited to two types — comprehensive cover and third party cover. "The comprehensive policy covers accidental loss or damage to the insured vehicle as well as third party liability arising out of the use of the vehicle. Third party insurance, on the other hand, covers only liability caused to third party property or person arising out of the use of the insured vehicle. In other words third party insurance does not provide any protection for loss or damage to the insured vehicle itself," says Vazayil.
The Traffic Department in the UAE requires that every vehicle has third party cover. If the customer has a car loan, the bank mandates that the customer have comprehensive cover. "It is always recommended that a customer opt for comprehensive cover. Most insurers provide comprehensive cover up to the seventh year of the vehicle," says Julien Audrerie, Head of Operations, Personal Lines, AXA Insurance Gulf.
When it comes to insurance, the cheapest is not always the best. "Never base your decisions purely on the premium quoted — you might end up paying more money later as buying a basic product will not protect you in all areas," says Vazayil.
Like any other class of insurance, auto insurance protects your asset (the motor vehicle) and your liability (arising from the use of the motor vehicle) for accidental loss or damage. "In other words it protects your financial interests on your assets and indemnifies you in the event of a liability," says Vazayil.
Royal & Sun Alliance offers auto insurance that can be bought online and buyers can avail a 10 per cent discount on premium when buying this way.
"Arranging insurance in the UAE can be slow, awkward and confusing. With the launch of faster-quote, people can choose their policy, pay online, and have their documents delivered to their doorstep," says Cooper.
