Motorists and fleet operators in the UAE are feeling the financial pressure as co-insurance fees on motor policies contribute to already high premium costs. Recent changes mean that when a driver is found at fault in an accident, they must pay up to 15% of the repair costs in addition to a standard deductible, creating a double burden for both individual owners and fleet services.
For fleet operators like Green Luxury Car Transport, the effects are substantial. “The new terms mean a minimum Dh2,000 deduction and a 15% co-insurance payment if our driver is at fault,” said Asad Khan, CEO of Green Luxury Car Transport. This change forces operators in services such as limousines, rentals, and ride-hailing to brace for a significant rise in maintenance costs—often adding tens of thousands of dirhams each year.
A Hit to the Bottom Line
With premium increases already affecting car owners, the additional co-insurance requirements further escalate expenses, particularly for those in the transportation sector. For individual car owners, even minor at-fault accidents now come with a substantial co-insurance fee, putting a strain on monthly budgets.
The Future of Motor Insurance in the UAE
As co-insurance costs continue to rise, experts advise UAE drivers to carefully review policy details before renewing. For fleet operators, implementing risk management and safe driving initiatives is becoming crucial to lessen financial impacts. With repair costs also increasing, the industry may experience further changes in policy terms as insurers adapt to market demands.
Motorists in the UAE are now encouraged to take these factors into account when choosing their next motor insurance policy to better handle the financial implications of co-insurance charges.
