• Sat. Jun 15th, 2024

UAE Insurance Premiums Surge by Up to 30% Following Unprecedented Rains


May 2, 2024 #UAE, #Weather

In the aftermath of the historic rainfall experienced in mid-April, insurance companies in the UAE have escalated premiums by as much as 30%, responding to the surge in claims for damages to vehicles and homes. The deluge, which marked the heaviest rainfall in 75 years, inundated several regions across the country, triggering a significant uptick in insurance demand and premiums.

Industry executives report a notable increase in premiums for comprehensive insurance packages, with some witnessing a doubling in demand post-rainfall. The absence of coverage for natural disaster damages under third-party liability policies has propelled owners to opt for costlier comprehensive packages, exacerbating the premium surge.

Toshita Chauhan, business head of health and motor insurance at policybazaar.ae, highlights a surge in claims by over 200% compared to previous weeks, particularly impacting saloons and sports/coupe cars. Moin ur Rehman, executive director of Unitrust Insurance Broker, confirms rate increases in segments such as motor and property insurance, particularly for flood-prone areas, with hikes ranging from 10 to 30%.

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While some industry experts foresee potential premium adjustments in the future, Avinash Babur, founder and CEO of Insurancemarket.ae, asserts that insurers are currently focused on evaluating claims and providing support to affected individuals. Faisal Abbas, vice president for employment benefits and general insurance at the Continental Group, anticipates a rise in premiums later this year.

The surge in comprehensive insurance demand underscores a heightened awareness of potential risks among individuals, prompting them to seek broader coverage. Avinash Babur notes a moderate surge in demand for comprehensive policies, while Moin Ur Rehman observes an uptick in demand for both property and vehicle coverage.

Toshita Chauhan observes a significant shift towards comprehensive insurance, particularly among owners of older vehicles previously insured under third-party liability cover. With renewal time approaching, an overwhelming majority of customers are opting for comprehensive plans, signaling a shift towards comprehensive coverage in the wake of the recent rainfall-induced damages.

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