The interior of an apartment after a high-rise residential tower fire. Contents of individual homes are not covered by the building’s insurance and are the responsibility of tenants, not building-owners. Picture for illustrative purposes. Image Credit: Ahmed Ramzan/Gulf News Archives

Dubai: The spate of fires, floods, and damage to property due to accidents or thunderstorms in recent months should make people be proactive and not reactionary in protecting their personal belongings at home, insurers say.

Residents of the two towers in the Ajman One cluster that were damaged on Monday night fear the worst — losing everything they own to the fire. Many of the residents Gulf News spoke to do not have home contents insurance that would have helped them in emergencies like this.

Just two weeks ago, a fire broke out in a residential building in Abu Dhabi injuring 15 people. A week before that, torrential rain flooded many communities in Jebel Ali, with two-foot flood waters damaging furniture and appliances in people’s homes.

The problem, insurers say, is residents’ misconception that their landlords can cover for them during emergencies.

“The top mistake that expats usually make is to assume that landlords would have this policy in place to protect their belongings,” David Harris, director, Marketing and Distribution at RSA Insurance, told Gulf News.

UAE laws require buildings to be insured. This covers the structure and common areas. But contents of individual homes are not covered and are the responsibility of tenants, not building owners or landlords.

Another misconception, Harris said, is many residents believe that home contents insurance is an additional burden.

“Expats wrongly assume that the UAE is not their final home country and investments like insurance are too much of a commitment,” Harris said.

Ramsey Chami, Head of Personal Property, AIG Mena, told Gulf News it is difficult to determine how many people in the UAE have home and contents insurance. But it is estimated that home insurance penetration is less than 10 per cent, which is very low compared to other markets.

In a Gulf News poll this month, only nine per cent or 136 of 1,501 residents said they have contents insurance. This means if a fire or a storm hits and personal property is damaged, only nine per cent of these residents polled can have, depending on their policies, alternative accommodation paid for by insurance, and their personal items paid for in cash, among other benefits.

But it’s not only the threat of fires or floods that should make residents reconsider their stand. Even small pipe bursts can damage property.

“The obvious risk of fire has been highlighted by several high-profile fires at prominent locations, although actually water leaks make up the majority of claims we see related to home insurance,” Chami said.

Salem Al Mannai, deputy group president and CEO, Qatar Insurance Company - Mena region, said the Ajman fire is yet another incident where many families could have been free of the financial distress they face after losing everything in the fire. He debunked the common misconception that home contents insurance is expensive, with the policy costing just Dh10 a month.

In 2015, Gulf News compared four insurance premiums and found out that the minimum is Dh225 a year — or Dh19 per month — for a coverage of Dh75,000 (prices vary).

This amount is less than what people would casually pay for a cup of coffee, in return for priceless peace of mind, Harris said.