Major overhaul for drivers’ insurance
ABU DHABI // The Government has announced a major overhaul of motor insurance rules, including mandatory replacement cars for drivers after accidents.
The Insurance Authority yesterday said a unified national policy would be introduced, which would for the first time wrap third-party cover and comprehensive loss and damage into one.
After an accident, insurers must provide policyholders with a replacement car, or compensation equal to the cost of one – up to Dh300 a day – for a maximum of 10 days, said Ibrahim Al Zaabi, director general of the authority.
Before the changes, a replacement car was provided by only some insurers, depending on the policy.
Third-party coverage will be extended to husbands, wives, children and parents, and payments for damage to property will be up to Dh2 million from Dh250,000.
Discounts to premiums will be available to drivers who have a good history, and heavier costs for those with a bad record.
The unified regulations will apply to the 3 million active vehicle insurance policies.
They also clarify sections of existing policies, such as when a car must be written off by an insurer, and allow insurers and their customers to seek mediation from experts to resolve disputes.
“The Insurance Authority has worked on achieving the highest level of fairness and transparency in the unified regulation in line with the requirements of policyholders, companies and the interests of the domestic markets and the economy,” Mr Al Zaabi said.
Insurance companies last year received Dh5.6 billion in driver premiums, comprising about a fifth of all total insurance payments, the Insurance Authority said.
“The new regulation supports the legislative base of the insurance sector of the UAE and entities operating therein,” said Sultan Al Mansouri, Minister of Economy.
“It increases the sector’s competitiveness at the regional and international levels in accordance with the best international practices.”