The most common class of insurance in this part of the world is Motor Insurance. Most of the Gulf States have made Third Party Motor Insurance mandatory, with certain limits against property damage but unlimited in respect to bodily injury or death. These Third Party Insurance policies can also be extended to include the risks of fire and theft.
However Comprehensive Insurance is most the commonly sought policy, covering accidental loss or damage to the insured vehicle in addition to the third party legal liability. Often if the vehicle is financed by the Banks or Financial Institutions, they generally seek comprehensive cover with a Hire Purchase Clause assigning the interest under the policy to the Institution.
While taking out an insurance policy for a vehicle, one should pay special attention to the following factors:
- Reputation of the Insurance Company
- Scope of cover provided
- Liability limits
- Liability to family members or to employees
- Limitations of use
- Deductibles on the policy
- Agency repair options
- Protection to the driver and passengers
- Personal effects cover
- Territorial limits
- Malicious damage
- Cover in the event of natural calamities, war and S.R.C.C.
- Replacement car or Hire car or cash benefit whilst the insured car undergoes repairs following an accident
- Auto assistance in the event of breakdown
- Vehicle registration services
- Off road coverage
Generally, the Premium is calculated by applying a percentage of the sum insured or the insured’s ‘estimate of value of the vehicle’ to be insured. Individuals with a proven claims-free record can avail better rates and can protect their no claims status, which comes handy while seeking insurance in other parts of the world.
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