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The premium rates of all types of car insurance policies decided to be increased from November 15, 2022, according to a group of insurance providers. At a meeting of representatives from eight insurance companies, the agreement was taken into account at the beginning of November. Their primary objective is the successful prevention of potential losses that can occur from price undercutting and selling motor insurance below cost.

According to the category of vehicle, the insurers agreed to increase the minimum cost of the policy of comprehensive car insurance in Dubai and all other emirates. For example, the premium for a saloon car has risen from AED 735 to AED 1,100 ($299.50), which is a significant hike. The cost of third-party liability insurance for motor vehicles has increased by 30%. Brokers will receive a 20% commission instead of the previous 30%.

The eight insurers decided to follow up on the agreement's implementation in a meeting soon. Other motor insurance companies that offer policies at highly affordable premium rates have also received an invitation to the meeting to join the charter that the eight insurers have already signed.

According to the reports, some large insurance companies in UAE are not ready to attend the meeting because they offer policies at more appropriate and acceptable premium rates, which can be higher than the minimum rates voted by the eight insurers.

Issues over large discounts 

The insurance industry is facing numerous challenges that require everyone's cooperation and support. One significant problem is that, since the COVID-19 outbreak began, some insurance companies have been offering substantial discounts of up to 80%, in violation of rules set by the UAE Central Bank. On April 22, 2020, the insurance regulator touched the motor insurance policy regulations for the amendment, resulting in allowing insurers to lower the required minimum insurance premium by up to 50% for the following persons:

• Front-line workers

• Healthcare workers

• Members of the armed forces

• Police Civil defense

• The people of determination

• The elderly

• People with accident-free records

The eight insurers who already attended the meeting will also do a proper market analysis the week after the price hike to track how it affects overall prices and make sure the brokers they work with carry out the agreement.