The Majalis Affairs Office at the Crown Prince Court Office in Abu Dhabi organized a lecture entitled "The Concept of Insurance and the new Motor Vehicle Insurance Policy" in Majlis "Hilal Zeid Al Shehi" in coordination with the "Insurance Authority" on 28 January 2019.
H.E. Ebrahim Obaid Al Zaabi, the Director General of the Insurance Authority, said at the opening of the lecture that the objective of the Insurance Authority, established by virtue of the Federal Law No. (6) of 2007, is to to regulate and supervise the insurance sector in order to ensure the provision of a favorable climate for its development and promote the role of the insurance industry to indemnify persons, property and liabilities against risks. As well as accumulating, developing and investing the national savings to sustain the economic development of the State, encourage fair and effective competition, provide the best insurance services with technically sound premiums and adequate coverages, and Emiratize jobs in the insurance markets.
He pointed out that the Law of the establishment has set several tasks for the Authority. The most important of which are: protecting the rights of the insured and beneficiaries of insurance, supervising the solvency of companies and providing adequate insurance cover to protect these rights. Moreover, raising the efficiency of companies, its commitment to the rules and code of conduct of the profession in order to increase its ability to provide the best services to the beneficiaries of the insurance business and to achieve positive and healthy competition between companies. As well as, working to provide efficient and qualified human resources to carry out insurance operation,including establishment of an institute for this purpose in cooperation and collaboration with Emirates Insurance Association (EIA) according to the prevailing legislations. Also, the proposition of programs and plans to develop the insurance sector in all aspects and enhancing insurance awareness, preparing and disseminating studies and researches relevant to the insurance operations. In addition to, establishing firm cooperation and integration ties with the authorities organizing insurance sector at both the Arab world and International levels. As well as, receiving applications to establish, open branches and representative offices for insurance and re-insurance companies, insurance brokers and insurance related professions and issuing them the necessary licenses.Moreover,identifying the risks that must be compulsorily insured, determining unified tariffs of certain types of insurances and of those one enlisted there under in case the public interest requires.
He explained that insurance is a process under which one of the parties "the Insurer" undertakes to provide a guarantee of compensation to another party "the insured" for the loss that may be incurred by the insured in the event of a risk happened. He clarified that the objectives of insurance are represented in several points. Most importantly, peace of mind, finding a solvent entity capable of accepting risks and paying compensations, providing economic protection to the members of the society, and providing protection to the national economy.
The Director General of the Insurance Authority emphasized that the unified motor vehicle insurance policy was issued by the end of 2016 and was effective as from 1/1/2017 to avoid the difficulties that existed under the old policy since 1987.
"The new motor vehicle insurance policy is designed to protect the rights of both the insurance policyholders and the shareholders of insurance companies. As well as, protecting the companies themselves from the risks they may encounter in the future. This will contribute to the development of the technical bases and rules necessary to promote the establishment of modern and advanced regulatory foundations for the motor vehicle insurance market and the UAE insurance market.
He added that the new vehicle insurance regulations seek to restructure the applications of motor vehicle insurance and to expand the insurance coverage in order to ensure the utmost possible protection for the insured and beneficiaries of insurance policies.
He pointed out that the Authority has made amendments to the new regulations in 2016 based of the results of the studies conducted on the new regulations in the domestic market, noting that these amendments help to encourage companies to provide the best services at competitive rates.
He stressed that the new policy included new benefits to customers and the sector.Furthermore, the new policy protects companies and shareholders to reduce the burning of prices.
The most important of these benefits; the expansion of the insurance cover in the third party insurance policy to cover the husband, wife, children and parents with an amount of AED 200,000 per person, in case an unfortunate event (death) happened. In case of injury, the compensation will be according the percentage of the disability per person. The loss of benefit principle was also adopted. The insurance company is obliged to provide a substitute motor vehicle to the owner of the damaged vehicle in the third party liability insurance or to pay the rental allowance for a similar replacement vehicle during the repair period with a maximum daily rent of 300 dirhams for a maximum period of ten days.
Additionally, in the third party liability insurance , insurance companies are liable to repair the damaged vehicle in the agency repair shops, in case the accident happened during the first year of the vehicle registration or being on the road. The policy has resolved the dispute between the insurance company and the owner of the damaged vehicle regarding the compensation for the damages or determining the market value of the motor vehicle. Moreover, the policy has increase the maximum amount of compensation for material damages in the third liability insurance for one incident to (2) million dirhams. Previously it was (250) thousand dirhams.
The new regulations regarded the driver of the motor vehicle whose driving license has expired as a licensed driver, if he managed to renew the license within 30 days from the date of the accident. In addition to clarifying the basis of repairing the motor vehicle and establishing a clear mechanism for the cash compensation and determining the timeframe for making decisions and resolving disputes, if any. As well as, developing a minimum and a maximum tariff rate according to the vehicle category and determine the percentages of deductibles.
The lecture is part of a series of lectures organized by Majalis Affairs Office in cooperation with the Insurance Authority, which will be held during coming period at different Majalis in Abu Dhabi concerning the concept of insurance and the new policy of motor vehicles insurance.