The unprecedented weather disruption in the previous month led to a remarkable surge in car insurance claims. The number of claims for damages that would typically occur over 12 years was reported in just a couple of days after the thunderstorms hit the UAE on April 16, as stated by Dubai-based insurance brokers.
The authorities, particularly the Central Bank of the UAE (CBUAE), have not disclosed exact figures on the extent of car damage caused by the floods. However, insurance providers and brokers observed an unparalleled volume of claims resulting from a single natural incident.
It was estimated by insurance brokers that around 100,000 vehicles in the country were impacted by the heavy rains, with many being deemed beyond repair due to water submersion, resulting in a total loss classification.
Karan Mulani, the business development manager at Pioneer Insurance Brokers, mentioned that an estimated 12 years' worth of insurance claims were filed within a few days last month. Susan Manalaysay Francisco, another Dubai-based insurance specialist, added that numerous cars were back on the road shortly after the incident, while others were undergoing repairs or had been written off by insurance companies.
The scale of the situation is substantial, with Muhammad Irfan Usman, a business development manager at Pioneer Insurance Brokers, stating that the number of claims runs into tens of thousands. He anticipates that it will take an estimated two to three months for the situation to normalize, as numerous cases are still pending responses from insurance providers.
Neeraj Gupta, CEO at Policybazaar.ae, emphasized that the processing time for car insurance claims in the UAE varies based on factors such as the complexity of the claim and the prompt submission of necessary documents. He also advised against attempting to start a damaged car and recommended moving it to a secure location to prevent further damage while maintaining records of associated expenses.
For those claiming flood damage, the process involves checking the insurance policy coverage, notifying the insurance company, gathering relevant information, and submitting a formal claim with all supporting documentation. In the aftermath of the unprecedented rainfall, motorists are advised to expect an increase in insurance premiums, with rates having risen by 20 to 50 per cent post the recent rains.
While premium increases are anticipated for car insurance, there is some relief on the home insurance front, with not all insurance firms having raised premiums. However, there may be potential adjustments to pricing for natural calamity coverage in the future, impacting both new and existing policies during renewals.
