About a year ago Mohamad Mustapha was braking for a red light along Airport Road in his grey Nissan Pathfinder when his car was hit by the one behind him. His vehicle needed repairs, and because police assigned fault to the driver of the other car, his case was sent to that driver's insurance company. He says he does not remember the company's name, but he certainly remembers how it went about fixing the damage to the car. He watched as representatives called about five people from different body shops and gave the work to the lowest bidder.
"I was passing to check my car and I found them taking the lowest price and I was like, 'What are you doing?'" he recalls. "I said 'How can you assume this is the fixation I want? Why shouldn't I recommend someone? How can I trust these people?'" After being assured that the work would be thorough, Mr Mustapha was disappointed to find that the shop had used wire on his bumper instead of screws. He had to get it done again.
"I went back to the insurance and they said to me, 'That's what we have,'" he remembers. Mr Mustapha's predicament illustrates the potential pitfalls of insurance in the UAE. Choosing the right insurer can be complicated. First-time car buyers wondering where to go for insurance may have to look no farther than the car showroom, where there is usually a resident insurer who will offer to take care of your insurance when you purchase the car.
However, Alexis de Beauregard, chief officer-Marketing and Retail Product Offering for AXA insurance, warns that motorists are not obliged to take that first option, and are free to shop around for the best deal - and that, he insists, is not necessarily the cheapest. More important is the value for money, depending on the quality of the service and the type of coverage available in the policy. "We frequently have customers coming to us and looking for larger covers and a better quality of service" Mr de Beauregard says.
"They say 'OK, that's fine, I'm happy to pay a higher premium (if any) for the additional value-added service you give me.'" If you are going to go it alone, the two big-name groups in the country are AXA and Royal Sun Alliance (RSA); other insurers include Abu Dhabi-based al Dhafra Insurance and al Ruwais Insurance Brokers. Banks can provide insurance as well. The first thing to decide when choosing insurance is the type you want: comprehensive, third party or fire and theft. Third-party insurance is the minimum amount of insurance cover a motorist must have by law. It covers you for damage to someone else's vehicle or property or injury to someone else in an accident involving your car.
It also includes injury involving a passenger in your car. You remain liable for any damage done to your own vehicle, however. Third party fire and theft insurance adds protection against loss by fire or theft to the basic package. Comprehensive, of course, in addition to the third party, fire and theft insurance, gives other options, which at AXA could include cover for serious injury to yourself and your passengers, as well as for lost or damaged personal belongings and guaranteed agency repairs.
It also provides a replacement car service while a customer's vehicle is being repaired, also has a 24-hour claims call centre. At RSA, comprehensive can include 24-hour accident recovery, two years guaranteed agency repair and optional hire car costs. As for what you might expect to pay, premiums vary for drivers depending on various factors, including the age and experience of the driver, previous claims history, the type of vehicle and its value.
Anealla Safdar, a reporter with The National, telephoned several insurers and asked them for a quote for a 2008 Peugeot 206. She is 24 and has been licensed for six years in Britain and a couple months in the UAE. She called five institutions offering insurance, including banks, and was quoted premiums between Dh1,800 and Dh3,500 per year for comprehensive coverage. She was also told that if she was 25, the premium would be reduced. Getting into a few accidents can also hurt your chances of securing top-of-the-line cover. Insurers will refuse to give comprehensive insurance to motorists with more than three at-fault claims in a year, according to Mr de Beauregard. If you are involved in a collision - an all-too-common occurrence in the UAE - then there are a few steps to follow.
Mr de Beauregard recommends ensuring you get a police report, then immediately contact your insurer to open a claim. He strongly advises against getting any work done on a vehicle without first getting the go-ahead from the insurer. The result of, say, taking your car to a workshop not approved by your insurer could be that the company will refuse to pay out on your claim. However, your past driving record, while considered, may not get you denied insurance, as insurers have no way of checking the driving records of expatriates in their homelands.
But if you have a long claims-free record back home, both RSA and AXA will offer very attractive discounts. RSA said it would insure drivers who declare that they have clean records. Be honest though, as if you do have an accident an insurer could ask you to provide evidence of your driving record. At the same time, picking up a certificate back home that states you have no claims could get you a better rate and discounts. firstname.lastname@example.org