Insurance Authority: the new insurance policy includes unprecedented benefits

: 1/24/2017
Emaratalyoum: January 24, 2017
 
Insurance Authority confirmed that the benefit of the insured, policyholders of vehicles, from insurance benefits in the new insurance policy is an unprecedented one.
 
Insurance Authority explained that the increase of deductible percentage is made to avoid raising the value of the premium at the time of insurance, pointing out that it put maximum and highest limits of rates and the insured may discretionally select one of the 61 companies, to get the best rate.
 
Insurance Authority affirmed that the increase of deductible percentage is simple and inures to the benefit of the companies, so that they can pay the compensation, on one hand, and serve the insured, on the other hand, to the extent that there will be no significant rise in the premiums. Abu Dhabi Chamber of Commerce and Industry lately organized a seminar on commercial insurance, in which a number of the attendees talked about the high rates of vehicle insurance policies and increase of deductible percentage. The speakers believed that the insured receives no added value or real benefits against such increases.
 
Unprecedented Benefits  
In more details, Mirza Kuna, an Insurance Expert in the Insurance Authority, said that the benefits contained in the new regulation of vehicle insurance is an unprecedented one and matches the best global standards.
 
“The ordinary and social media exaggeratedly addressed the matter of applying the new regulation of vehicle insurance policies, which entered into force in January 2017, and the concomitant increase in rates, and the insured may discretionally select one of the 61 companies, to get the best rate.” Kuna added
 
"The new insurance policy includes new benefits, some of which did not originally exist in the old insurance policy, and some of them are newly created, including, but not limited to, obliging the companies to repair vehicles within the Agency, and use the original parts if used for a year or less, unlike the former, if companies could resort to paper foreign contractors, as well as introduce the requirement to the quality of repairs, ensuring the return of the vehicle to the state it was before the accident, since the insured can them ensure the quality of repair of their vehicles, through neutral bodies, with the assistance of the Insurance Authority, if it is proven that the company committed a breach, the vehicle shall be returned to it once again to meet the requirement of quality." Kuna asserted
 
“One of the important items that have been modified, as well, is the standard of "total loss of vehicle", in which the damage was previously determined at a percentage 50% of the vehicle, as another standard was added, i.e. the damage of main fixed parts, even if the percentage thereof does not reach 50%. In such case, the insured will be entitled the full compensation.” Kuna added
 
 
Responsibility for Compensation
They added that the company's maximum liability for compensation, in accordance with the previous insurance policy, did not exceed AED 250,000 and same was identified 30 years ago. This is no longer appropriate, as there are expensive vehicles, stressing that such matter is addressed in the new regulation by raising it eight times to reach AED 2,000,000. So, it is one of the important amendments that have occurred.
 
They pointed out that the new insurance policy has expanded the insurance coverage to include husband, wife, mother and father, while it was previously limited to the driver of the vehicle only. Under the new insurance policy, insurance companies are obliged to provide a replacement vehicle for 10 days, and a maximum daily rent of 300 AED, if the vehicle reparation period will not exceed 15 days. After the elapse of such period, the policyholder shall obtain compensation as a result of the vehicle reparation delay.
 
Common Interest
They confirmed that the Insurance Authority prepared the new regulation of vehicles insurance policies, after consultation with the insurance companies and the public, pointing out that the work lasted for full three years before its release, to make sure that it is in accordance with best practices.
 
They stressed that it is necessary to be aware of the provisions of the new insurance policy, so that the policyholders can determine their rights. The Insurance Authority seeks to reach such end through programs, seminars, and website.
 
They stated that the deductible percentage was applied in the previous insurance policy, in its both parts, and the increase made thereto is simple and inures to the benefit of the companies, so that they can pay the compensation, on one hand, and serve the insured, on the other hand, to the extent that there will be no significant rise in the premiums.
 

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