The Insurance Authority revealed that the average value of car insurance premiums in the post-Corona virus period, which was new this year, decreased by 15.6%, compared to the average price over the past year. The authority stated to «Emirates Today» that it has issued a decision to give a discount of up to 50% for the minimum insurance premium for specific categories.
In addition, the Emirates Insurance Association said that vehicle insurance rates have already witnessed a decline in recent months due to several factors, the most prominent of which is competition between companies, in addition to the low number of insurance claims with the decrease in vehicle driving rates among individuals during the period of national sterilization.
In detail, the insurance authority stated that the average value of vehicle insurance premiums in the period before the new Corona virus, which occurred in the current year, is close to what the average price witnessed last year. The authority explained to «Emirates Today» that, in contrast, the average value of vehicle insurance premiums in the period after “Covid-19” of the year 2020 decreased, 15.6%, compared to what the average price witnessed in 2019.
Discount
As for whether the authority will review the minimum prices for auto insurance policies under the current circumstances, it indicated that out of concern for the need to mitigate the impact of the spread of the "Covid-19" virus, the insurance authority issued on April 22 last year to legislate that it can give A discount of up to 50% on the minimum premium for the vehicle owner when renewing or issuing new documents, for medical workers, employees of the army, police, civil defense, owners of determination, and elderly people over the age of 60, as well as the insurance applicant with an accident-free record .
Competition
To that, the Secretary General of the Emirates Insurance Association, Farid Lutfi, said, “Vehicle insurance rates have already witnessed a decline in recent months due to several factors, the most prominent of which is competition between companies in this vital sector, as well as the decrease in the number of insurance claims with the decline in vehicle driving rates among individuals during National sterilization program.
He added that "in light of the lack of claims and the decrease in costs that companies pay to maintain vehicles that are damaged by accidents, the field widens more for these companies to reduce the prices of auto documents." He pointed out that "the insurance sector, like other sectors, interacts with the developments and impacts resulting About the Corona pandemic.
Free months
Lotfi stated that “a number of insurance companies resorted to granting free months to their customers while other companies resorted to reducing premiums at remarkable rates when renewing the documents.” He pointed out that “insurance companies interacted with the decisions issued by the Insurance Authority a while ago which represented the possibility of giving a discount Up to 50% of the minimum premium for the vehicle owner when renewing or issuing new documents, for specific categories of professionals and the elderly, as well as owners of traffic records free from accidents ».
Lotfi explained that "the policies of pricing auto insurance policies vary from one company to another and have a direct relationship with the size of the portfolio for this sector and the profits or losses for this portfolio during the last year," noting that the pandemic has created new conditions for the work of insurance companies similar to other sectors.
Limited growth
The General Secretary of the Emirates Insurance Association, Farid Lutfi, expected that the vehicle insurance sector will witness limited growth or a decline during the current year, pointing out that competition between companies may reduce prices, and thus the effect of this on the size of the premiums in the local market during the current year.
Lotfi added that the legislation regulating the activities of insurance companies enhances the development of the sector and its ability to deal with flexibility from new developments.
Car insurance policy pricing policies vary from company to company.
Azad و Dubai