Car insurance can sometimes be confusing, with many myths floating around that can lead drivers astray. Understanding the facts is crucial for making informed decisions and ensuring you're adequately protected against legal liabilities. Let's clear up some common misconceptions about car insurance in this blog.
Myth: Car insurance validity period is 12 months in the UAE.
Fact: In reality, car insurance is valid for 13 months for both comprehensive and third-party liability (TPL) plans in the UAE.
Many people believe their car insurance only covers them for 12 months, but in fact, the policy extends to 13 months here in the UAE. This extra month provides a bit of a buffer to renew or switch your insurance without a lapse in coverage should your vehicle fail an inspection. It’s important to note though that you can still be fined if you do not renew your registration between months 12 & 13.
Myth: Third-party car insurance covers all damages.
Fact: Third-party insurance covers damages and injuries caused by the insured vehicle to a third-party person or property.
While third-party insurance is crucial and mandatory, it’s important to understand that it doesn’t cover damages to your own vehicle. Instead, it protects you from liabilities arising from damages or injuries you may cause to others.
Myth: Safe drivers do not need insurance.
Fact: Buying third-party insurance is mandatory in the UAE, regardless of how safe a driver you are.
Even if you pride yourself on being a careful driver, third-party insurance is not optional; it’s required by law. Additionally, comprehensive insurance, while optional, is highly recommended as it covers a wide range of incidents including accidents, natural calamities, and theft.
Myth: Car insurance gets cheaper for older cars.
Fact: Though the Insured Declared Value (IDV) decreases as the car ages, other factors like the age of the insured and claims history can influence and potentially increase the premium. This is also in addition to any market or regulatory price increases.
It’s a common belief that older cars cost less to insure. However, multiple factors contribute to the premium calculation, and sometimes, these factors can lead to higher premiums despite the car's depreciating value.
Myth: Insurance only covers accidents where the insured is not at fault.
Fact: Insurance companies pay for claims as long as the insured has a valid driving license and the claim is in accordance with the policy cover and terms.
Insurance policies do cover accidents where you might be at fault, provided you were not under the influence of drugs or alcohol and the vehicle was being used as intended (e.g., not using a private car for commercial purposes).
Myth: Buying insurance for your car is time-consuming.
Fact: With the option to buy car insurance online, the process has become quick and easy. For instance, with Shory, it can be done in 90 seconds.
Myth: Changing insurers results in losing the No Claim Discount(NCD).
Fact: The NCD is given to the policyholder, not the vehicle, and it transfers even if you change your insurance company.
The No Claim Discount is an incentive for drivers who do not make any claims during the policy period. If you decide to switch insurers, rest assured that your accumulated NCB will follow you.
Myth: Car insurance has to be renewed with the same insurance company.
Fact: You can change your insurance company at the time of renewal, and the No Claim Bonus (if applicable) will be transferred as well.
You have the flexibility to shop around for better deals or services when your policy is up for renewal. This freedom ensures you get the best possible coverage and rates.
Myth: Insurance companies deliberately reject claims.
Fact: Claims are processed successfully if they are filed for the right reasons and according to the policy terms.
Insurance companies do not reject claims arbitrarily. As long as your claim is legitimate and within the policy's scope, it will be processed without issues.
Conclusion
Understanding the facts about car insurance helps you navigate your options more effectively and ensures you have the appropriate coverage. Dispelling these myths empowers you to make informed decisions, providing peace of mind on the road. Remember, always read the fine print and stay informed about your policy details. Safe driving!
