UAE Releases New Advisory on Vehicle Insurance and Natural Disasters

Attorneys emphasize the critical need for individuals to thoroughly read and comprehend the terms of their vehicle insurance policies, particularly regarding coverage for natural disasters.

Importance of Policy Understanding

They caution that failure to understand these details may lead to a denial of comprehensive benefits, urging policyholders to be well-informed before signing any insurance agreement.

Agreeing on Additional Rights

Legal experts clarify that insurance beneficiaries can negotiate rights beyond those outlined in the unified insurance document. This flexibility allows for the inclusion of additional provisions through mutual agreements, expanding the scope of coverage for the beneficiary even if it surpasses the standard terms set in the unified insurance document.

Significance of Reading Policy Details

Legal advisor Muhammad Khalifa underscores the importance of a meticulous examination of insurance policies. He highlights that insurance coverage is typically contingent on the terms specified in the policy, and without proper understanding, damages caused by natural disasters such as storms, tornadoes, and floods may not be covered.

Limitations and exclusions

Chapter Four of the unified insurance policy outlines exceptions that restrict certain cases from coverage and defines the liability of the insurance company. These exceptions encompass accidents related to or arising from natural catastrophes, emphasizing the need for policyholders to be aware of these limitations.

Legal Interpretation of Natural Disasters

Natural disasters are regarded as force majeure events beyond individual control. However, legal advisor Khalifa clarifies that insurance companies are not automatically absolved of responsibility unless a competent authority deems the incident a natural disaster. Some insurers may seek to exclude damage caused by natural events, but coverage for rain-induced damage is typically included unless expressly excluded.

Insurance Coverage for Weather-Induced Damage

Despite severe flooding in Fujairah, where a natural disaster decision was pending, insurance companies are required to make up for the harm that the event caused. This illustrates that unless a competent authority officially classifies the incident as a natural disaster, insurers are liable to reimburse damages resulting from severe weather conditions.

Unified Vehicle Insurance Policy Clauses

Insurance companies are not liable for incidents that are directly or indirectly caused by natural catastrophes, according to Dr. Mohsen Al-Khabani's citation of Clause Nine of Chapter Four of the unified car insurance policy.

As The document states that in order for an event to be designated as a natural catastrophe, the relevant authority must decide that it is a widespread and damaging phenomenon that originates from nature. To better grasp the breadth of coverage in unified insurance policies, this definition is provided.

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