What are the Types of Motor Insurance in UAE: Comprehensive Insurance & Third-party Insurance

Introduction

Finding the best car insurance plan in the UAE might be a daunting task for you, if you find it challenging to decipher the details of the insurance plans. There are several factors associated with it which car owners must learn before choosing a motor insurance policy. Among all of the factors, an in-depth knowledge about the major types of motor insurance in the UAE is an essential one.

Often, different insurance providers list down various types of plans when it comes to offering car insurance coverages. However, the two types of motor insurance that most leading insurance companies offer accumulating all benefits within, are comprehensive insurance and third-party insurance.  

Knowing about these two major types of policies in detail can help car owners make an informed decision about which one they should go for. So, here is the blog that will discuss essential points about the two types of motor insurance policies in the UAE. 

Types of Car Insurance in UAE

A comprehensive motor insurance provides an all-round coverage to protect your vehicle from any sort of unforeseen natural disasters and accidents. It covers your personal damages as well as third-party damage claims. Looking at its vast coverage, experts always recommend securing new cars with a standard comprehensive car insurance plan availed from trusted insurance companies. 

On the other hand, third-party motor insurance is a cost-effective and less complex policy plan to get coverage for third-party damage claims against your vehicle. Obtaining it can save car owners for legal hassles and financial liabilities in cases of third-party claims for vehicle damages and injuries. 

What is Comprehensive Motor Insurance?

A comprehensive motor insurance policy in the UAE offers complete, full-proof protection to your car against any mishap like natural calamities, accidents, and man-made acts. It covers the damages to the vehicles of both – the insured and third party. In detail, it provides financial and legal support to your vehicle in cases of:

• Theft
• Accidents caused by your fault 
• Accidents caused by third-party faults
• Fire damage
• Terrorism, vandalism, riots, and other man-made activities 
• Third-party liability lawsuits 
• Roadside emergencies including the requirements of tire change, jump start, etc. 
• Natural disasters including flood, rainfall, hailstorm, sandstorm, earthquake, etc. 
• This insurance policy does not cover damages in the below-mentioned scenarios: 
• Accidents that took place while driving under the influence of alcohol or illegal narcotics  
• Damages that take place while using the car for illegal acts
• Cases of nuclear disasters or wars
• Using of car beyond its due usage limit
• Willful activities of owners to cause the damages
• The active presence of underage driver on the driver’s seat
• Inability of the driver to show a valid driving licence 
• Damages resulting from poor upkeep of the vehicles

What is Third-Party Motor Insurance?

A third-party motor insurance policy includes coverage for the damages to third-party vehicles caused by your vehicle. It also covers death and injuries happened to the third-party driver or car owner.  Often, obtaining this policy is recommended by experts as a minimum coverage plan that car owners need to comply with the UAE law regulations.

Anyway, in this insurance plan, to get coverage for your own vehicle’s damages except what the third-party faces, or to cover natural-disaster damages, you may have to ask your insurance providers for add-on facilities. 

This is what car owners can get by obtaining third-party motor insurance policy from reliable insurance companies:

• Security from lawsuits and legal liabilities in case of unwanted mishaps with third-party vehicles caused by your vehicle
• Coverage for third-party claims at a low premium cost and deductibles
• Safety from undue expenditure on insurance plan when your car is quite old or you can pay for the repair charges by yourself

Comprehensive Insurance or Third-party Insurance: Which one should you opt for your new car?

Third-party insurance is a cost-effective option to save car owners from legal hassles that may occur for not complying with the UAE federal laws. On the other hand, comprehensive insurance policy offers best coverage to insure cars against any possible mishaps with it. Anyway, the premium cost is higher for the latter than the former. 

Looking at these scenarios, experts recommend opting for third-party insurance if your car is quite old enough and does not hold much value. Also, if car owners do not have enough budget to pay a high premium cost, this is a basic plan to comply with the law covering third-party liabilities. Nonetheless, if it is a brand new car or a valuable vehicle, paying a higher premium shouldn’t be a concern as it saves you from high repair and replacement costs in cases of accidental damages, natural disaster impacts, theft and many other cases. 

Final Words

Looking at these scenarios, experts recommend opting for third-party insurance if your car is quite old enough and does not hold much value. Also, if car owners do not have enough budget to pay a high premium cost, this is a basic plan to comply with the law covering third-party liabilities. Nonetheless, if it is a brand new car or a valuable vehicle, paying a higher premium shouldn’t be a concern as it saves you from high repair and replacement costs in cases of accidental damages, natural disaster impacts, theft and many other cases.