Safe drivers in UAE entitled to no-claims discounts of up to 20%

Thanks to new regulations, UAE motorists with clean records have the right to cheaper car insurance premiums

Those with clean records can now demand their insurer offers them a better deal when renewing their policy. Courtesy Dubai Police

Safe drivers must demand no-claims discounts on their car insurance, experts advise, after new regulations from the UAE Insurance Authority  came into force at the start of the year.

Jonathan Rawling, the chief financial officer of comparison website yallacompare, said the new rules, which entitle motorists with clean records to discounts of up to 20 per cent on their insurance renewal, reflect the market’s shift towards a more sophisticated pricing system.

“Many insurers do not adjust the premium at all based on your previous driving experiences – regardless of whether or not you have a no-claims certificate, which states you haven’t made a claim on your car insurance, and are therefore less risky to insure,” said Mr Rawling.

“The UAE Insurance Authority has recognised the issues with this and in its latest regulation amendments have mandated that insurers give discounts for drivers who haven’t claimed on their policies and want to renew.”

The car insurance amendments, announced in December by the authority’s board of directors, said vehicle owners who have not caused or had an accident are entitled to reduced premiums ranging from 10 to 20 per cent.

Under the Board of Directors’ decision No (41) of 2017 - which amended the board of directors’ Resolution No (30) of 2016 - drivers with a clean record of one year should receive a 10 per cent reduction in premiums; those with two years without incident can demand a 15 per cent discount; and motorists with three years without a claim are entitled to a 20 per cent discount.

“The amendments contribute to enhancing the competitiveness of the local market and encouraging insurance companies to provide the best services," Sultan Al Mansoori, Minister of Economy and chairman of the Insurance Authority, said in December.

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Another crucial amendment from the authority was that insurers must provide no-claims certificates to customers free of charge.

“Under the previous regime, insurers would traditionally charge their customers an administration fee for providing a no-claims certificate. We are aware that some insurers are still charging for these certificates. If you encounter this, we’d point you towards the UAE Insurance Authority website to lodge a complaint,” said Mr Rawling.

The amendments will have benefits for the market, such as better deals for safer drivers and increased competition as companies look to secure the business of those with clean records, even adjusting their prices to accommodate no-claims discounts.

Customers welcomed the decision, adding that it would encourage them to shop around for the best deal.

“I have not made a claim on my insurance for eight years, therefore I would welcome a discount for my good driving,” said Peter Philips, a British teacher from Dubai. “In the past, the no-claims discount did not seem to reduce my premium and was of no benefit when renewing my policy. But I will be scouring for a better deal when I renew again in July.”

The authority’s amendments to its regulations also mentioned discounts for coverage on motorbikes and electric vehicles, as well as benefits for fleet owners.