Motor Insurance for Young and/or Newly Licensed Drivers in the UAE

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In the UAE, as per the unified policy (this policy is the minimum cover every insurance company has to offer), anybody with less than a one year drivers’ license and/or under the age of twenty five would have to bear 10% of the total claims cost if they make a non-recoverable claim (i.e. a claim where they are at fault or there is no third party to claim from like a hit and run).

Some policies further restrict coverage for drivers under 30 or may even be named driver policies. Though the legality of restricting the unified policy, which has been approved as a minimum stipulated coverage by the UAE Insurance Authority, is questionable and probably not legally enforceable, it’s best you avoid any issues if you have a young driver driving your vehicle (or you’re young yourself!) by checking your policy carefully.

There are just too many accidents happening across all the Emirates. Studies show that the majority of them involve newly licensed young drivers. It is a tragedy when you lose a friend or relative to any type of accident, but it is worse knowing it could have been prevented.

One of the main reasons these accidents are happening is due to the lack of driving skills these young drivers have when they get their license – and practice! In one family, there may be a son or daughter who have come of age. Since the vehicle is used by the father most of the day, they can only practice for a very limited time each day. That is not enough. They need to be out on the road, driving regularly after passing the road test.

There are other factors that a new driver is up against.

l  Passengers, usually friends the same age. The driver may feel the “peer pressure” to drive faster, when the friends in the car are hooting and yelling in the back seat.

l  There are bad drivers out there. The more you drive, the more you will see them.  Many times it is not your driving that causes an accident. Experience allows you to avoid many situations that can occur on the road. Drive defensively.

l  Drivers must have control of their vehicle. They need to be aware of reckless drivers,    their speed, watch the lights and obey all signs. You have to look at the big picture and it takes a while to be able to grasp everything all at once.

l  Parking a vehicle. It really is harder than it sounds. Parking lot accidents happen everyday, some to even the most experienced drivers. The difference is the way an Insurance Company looks at an accident. An experienced driver may lose their claims free discount. If it is a young driver just starting out, it means a huge and probably unaffordable increase in their premium. They will have to start at the bottom again and work their way back up.

At we have special solutions for young or newly licensed drivers – give us a try!

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How important is agency repair in auto insurance?

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Okay ladies and gents – the agency repair phenomenon is something you must understand properly in order to take an informed decision. It’s an industry in crisis and more expensive certainly does not mean more value – however, this does not mean that you may go ahead with non-agency repair coverage in all cases. Let me explain right from the beginning. Don’t panic though – once you’ve understood how things work it all becomes quite simple really!

When you buy your car insurance in the UAE, the insurer promises you that they would take the responsibility of the financial cost that arises in the event of an accident on the road, relieving you from this significant exposure – hurrah! (I love insurance.) However, unlike most other kinds of insurance, the insurer does not write a cheque out to the policyholder in the event of such a loss – they would actually have the repairs of your damaged vehicle carried out themselves, through one of their affiliated workshops. Why? Good question:

As there are well over a million vehicles on the roads of the UAE, the market for motor insurance is huge (since it is mandatory) and this means that the volume of claims made to the insurance company (as a result of road accidents), on a daily basis, is also huge. Since the insurance company is literally footing the bill of all these accidents, they would obviously want to minimize their cost and also avoid any loopholes in the system that may motivate fraud. Therefore, they work with the garages that repair cars and have your cars repaired for you – you can also take it as a value-added service. Since the garages receive business from one source (i.e. the insurance company) in very significant volumes, they can afford to drastically bring down their rates due to scale economies. In addition, since the proximity of the insurance company to the cost incurred increases, they are able to be closely involved in the process to make sure that there is no waste, exploitation or fraud.

Now, another phenomenon that you must understand is that authorized dealers – as in most countries, sell most makes of cars in the UAE. Each make has only one dealer either for the whole country or at least for an Emirate or group of Emirates. So, for example, the authorized dealers for Toyota in Dubai are Al Futtaim and Mercedes in Abu Dhabi is Emirates Motor Company. These organisations are not only responsible for selling you your brand new shiny car that smells incredible, but also have the infrastructure to service the vehicle on a regular basis and… repair the vehicle in the event of an accident!

So it is widely understood that agency repair cover (i.e. an extension to your car insurance policy that guarantees that the authorized dealer of your vehicle would repair your car in the event of a claim) means that you are guaranteed that genuine parts (and usually brand new parts) would be used to repair your vehicle and since those people are responsible for all of the cars of that make on the road they know the vehicle well (and the automaker usually tends to closely supervise their work for quality control in order to protect their brand name) and hence will be able to diagnose every issue well and thereafter provide the best solution for your repair. Wonderful.

But this is only the beginning of the story. You must understand that there are two major issues when it comes to agency repair – both arising from the fact that the dealers have a monopoly (sort of) for their makes. Firstly, it’s the cost of having agency repair cover: since the repairs are significantly more expensive at the agency the insurance company makes sure that they collect enough overall premium in order to be able to create a fund that adequately finances these repairs. You will usually pay significantly more for agency repair coverage.

Secondly, it’s the time taken to repair. Any monopoly struggles to give good service – it’s understood as a principle of basic economics. It is commonplace to hear stories of the agency staff being inconsiderate, unhelpful and slow purely because of the volume of work that they have – the key motivator for this is that the customers have nowhere else to go for their offering – which is true. Also, while the dealers are governed by the makes that they represent, the UAE is a small part of the global auto industry and because changing a dealer imposes a huge cost in terms of transition and reputation, we never hear stories of automobile companies deciding to change agencies (which actually could create some competition and therefore improve service).

To add to this, non-agency workshops are in a competitive marketplace. For them, it’s all about customer retention and their USP therefore has to be outstanding quality of work and service (rather than the brand name of a German car brand) or, in the case of shoddy places, price. It is for this reason that it is sometimes surprisingly easier and more effective to work with non-agency workshops.

Moreover, many workshops have been setup by the workshop managers of the agencies themselves, which means that the same systems and processes are carried out; hence the standard of work is exactly the same as the agency for that car make. The well-reputed insurance companies actually provide such A-grade workshops to their non-agency clients as a means to ensure long-term customer retention! Similarly, shoddy companies that offer cheap policies work with shoddy garages because they’re cheaper. Ah – this is so interesting!

So here are Alfred’s rules of thumb when it comes to agency repair:

If your car is brand new then you’re supposed to have agency repair free with your comprehensive insurance cover – regardless of which insurance company you’re insuring with – full stop.

If you’ve been claims free fore more than three years, you’re going to be eligible for ‘executive’ coverage from one of the leading insurers which would include free agency repair coverage, as a reward for driving so safely. In this case, it’s free so you’d might as well go for it! (Though you could actually save some money if you went for standard rather than executive coverage as you’d still get the No Claims Bonus anyway – so do look at both options and see if there actually are significant cost implications).

If your car is not brand new but under a warranty or extended warranty from the dealer, you’d might as well go for agency repair as non-agency repair in the event of an accident may void your warranty.

If you’re going for a reputed, tried and tested insurance company like any one of’s partner companies (hint!), then you would be guaranteed repairs and we have made sure that the cars on non-agency coverage go to A-Grade non-agency workshops. In addition, your repair would also be supported by a 6-month guarantee to give you complete confidence that your insurance provider and workshop takes complete responsibility for their work. In all likelihood, since these workshops are not monopoly-like setups, they would ensure that your repair is done quickly and to the highest standards so that they may win you as a customer for your vehicle maintenance! You won’t have to wait for weeks to have your simple damage repaired just because the agency has no time…

If you’re going for a dodgy insurance company (which I wouldn’t recommend but I do believe in free will!) then you should at least choose agency repair coverage (if they actually offer that cover) if you want to ensure proper repairs – you don’t want your Honda Accord to come back looking like a Camry or something! Or even worse, you don’t want your car to sell for far less after the accident because of the quality and age of the parts used when it was repaired after an accident. Or the worst of all, you don’t want your car to become a hazard to your and your family’s life while you’re on the road.

If your car is more than five years old, it’s unlikely that any insurance company would offer you agency repair coverage (and you really don’t need it), so stop grumbling and get on with it! You’ll be just fine as long as you choose the right insurance provider!

Alfred is the wonderful brand mascot of where you can find the best insurance deals in the UAE with a commitment to outstanding claims service. We work only with the leading insurance companies in the UAE like AXA, Chartis, Fujairah National and Salama Takaful.

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Insurance Funnies- Automobile Accidents

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An automobile claims adjuster deals with people at their worst. They are upset, shaken, in shock and always, have their own version of how the accident happened. If you ask each party involved what happened, you are going to get a different story.

There are a few statements that may or may not be true. They have been around for many years and now printed on numerous websites. These are statements made to police or to the automobile insurance adjuster after they had been involved in an accident.

  • The other car collided with mine without giving warning of its intentions.
  • Going to work this morning, I drove out of my driveway straight into a bus. The bus was 5 minutes early.
  • I didn’t think the speed limit applied after midnight.
  • I thought my window was down, but I found out it was up when I put my head through it.
  • A truck backed through my windshield into my wife’s face.
  • A pedestrian hit me and went under my car.
  • The guy was all over the road. I had to swerve a number of times before I hit him
  • I pulled away from the side of the road, glanced at my mother-in-law, and headed over the embankment.
  • In my attempt to kill a fly, I drove into a telephone pole.
  • I had been shopping for plants all day and was on my way home. As I reached an intersection, a hedge sprang up, obscuring my vision and I did not see the other car.

I can honestly say that I am not surprised at these statements. You are shaken after having an accident and could spurt out anything. I think probably 99% of people involved in an automobile accident, do not feel they were responsible for it. I personally received a call from a client who needed a new windscreen. When asked what happened to it, she told me that she was driving and this pesky mosquito was irritating her, so she tried to get it, hit the windshield, cracked it, and still didn’t get the bug. Here are a few more.

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  • I had been driving for 40 years when I fell asleep at the wheel and had an accident
  • I was on my way to the doctor with rear end trouble, when my universal joint gave way, causing me to have an accident.
  • To avoid hitting the bumper of the car in front, I struck the pedestrian.
  • As I approached the intersection, a sign suddenly appeared in a place where no stop sign had ever appeared before. I was unable to stop in time to avoid the accident.
  • I saw a slow moving, sad faced old gentleman…as he bounced off the roof of my car.
  • My car was legally parked as it backed into the other vehicle.
  • On approach to the traffic lights, the car in front suddenly broke.
  • An invisible car came out of nowhere, struck my car and vanished.
  • I was sure the old fellow would never make it to the other side of the road when I struck him.
  • The pedestrian had no idea which direction to run, so I ran over him.
  • I was thrown from my car as it left the road. I was later found in a ditch by some stray cows.
  • The telephone pole was approaching, I was attempting to swerve out of its way, when it struck my front end.
  • Coming home I drove into the wrong house and collided with a tree I don’t have.

While stories like these raise a smile, it underlines the importance of automobile insurance cover. Most Companies have outstanding claims adjusters who help people through the claims process. It doesn’t matter how bizarre or how embarrassing it may be to the client, if you ask them, a claims adjusters will tell you they have heard everything.

Do you have any queries on auto insurance claims? Feel free to meet Alfred.

[Some funny statements have been taken from other resources. Below are few examples:]

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Alfred’s tips on driving safely during the Holy Month when the heat goes up to 50 degrees; Ramadan Kareem!

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The Holy Month of Ramadan will start on the 9th of July and is expected to continue until the 7th of August. During this period of time, there are numerous summer festivals taking place for all to enjoy. It won’t take long before you notice an increase in traffic and perhaps due to the weather the driving on UAE roads can become a bit reckless. After all, the temperature in the summer rises to a balmy 50 degrees Celsius! If you have children in the car and have no air conditioning, the drive could be brutal. Recent articles have shown some very sad incidents where children were left in their parents’ cars, without air conditioning, for a period of time. Cars heat up in seconds in this part of the world – please do not do this, ever! Here are a few tips from Alfred that may help you while out driving:

  • Take a few extra bottles of frozen water for each person in the car. Just freeze them in the freezer over night and have a small cooler in the car. It is a great if you have any perishable foods that could turn in the heat. Once it has melt, you will have cold drinks.
  • Make sure your tires are good shape. Check your fluids in the car, transmission, radiator, oil, belts, filters, hoses and wipers. It is a good time to take the car in for an oil change. If you have road service, make sure you always have their information with you.
  • There is usually a tire in the trunk for an emergency. Make sure it is in good shape.
  • Nothing could be worse that sitting in traffic at 50 degrees Celsius. This may sound strange, but turn up your radio. A little diversion to lift your spirits, can take your mind off the traffic and the heat.
  • Try working staggered hours to avoid rush hour traffic.
  • If you are going to have kids in the car, make sure they have used the rest room before leaving the house. It may be an idea to have a reading book for them.
  • There are dashboard protectors that you can put across the inside of the car to help in 2 ways. One to keep the inside of the car a little cooler, and two, it also helps stop the fading of your dashboard.
  • While driving, slow down. You will get where you are going. Being patient, is a virtue.
  • Just drive defensively. Ignore the guy driving beside you that is cursing and waving his arms around like a mad man. You don’t want road rage.
  • People may become agitated in the heat especially when they have not had anything to eat all day. Maintain safe distances.
  • Always make sure you have your ownership and your proof of motor insurance with you. If you are pulling a trailer behind you, make sure you have insurance to cover it for towing it around.

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You may already be aware of these tips and if you are doing them, I hope they are working for you. The focus here, is safe driving on the road, and taking care of your family. Being prepared is half the battle. Patience greatly reduces the chances of having an accident. Let’s hope that the holy month this year brings the fewest casualties on the road.

Check out special promotional Ramadan rates for auto insurance on Ramadan and Eid Al Fitr are a great time to buy a car in Dubai, especially because of the special offers from dealerships, banks (for loans) and car insurance companies! Happy Motoring and Ramadan Kareem!   

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