Vehicle owners are complaining that some insurance companies have been refusing to sell them comprehensive insurance. Instead, the insurers offer them motor third-party liability insurance.
According to car owners, insurers are rejecting business where the vehicles are models released before 2017, or because the driver is younger than 27 years old. This is so even when the car was insured in past years with the same company or has an accident-free record, reported Emirates Today.
Where insurers agree to provide comprehensive coverage, the motor policies are renewed at a much higher price.
Insurers, on their part, say that they are denying comprehensive coverage to drivers aged younger than 27 because they have incurred huge losses as a result of the behaviour of some young drivers, specifically during the period of poor weather conditions that the country underwent.
Mr Mohammed Mazhar Hamadeh, chairman of the Motor Insurance Technical Subcommittee of the Emirates Insurance Federation, said that several options are available to vehicle owners in the insurance market.
He said: "Each company has its reasons for rejecting coverage, which may be related to technical matters or as a result of it bearing large compensation sums, losses, or other things."
He added: “All companies are obligated to provide third-party liability insurance. With regard to comprehensive insurance, companies evaluate the history of the insured, so if there are repeated accidents, and at close intervals, for example, then the company has the right to refuse comprehensive insurance, as a result of the large compensation amounts it has paid.”
He said that the customer has the right to seek another insurer that accepts comprehensive insurance.
The Central Bank of the UAE stresses, in the unified motor insurance policy guide, that an insurance company has no right to reject a comprehensive insurance application, except for technical or actuarial reasons based on its previous experience with the insured.