Vehicle, Property Insurance Rates May Rise After Record Rain
- Publish date: Wednesday، 24 April 2024
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Vehicle and property insurance rates in the UAE may see an uptick following last week's record-breaking rainfall, according to a report by S&P Global Ratings. The intense downpours led to significant damage, impacting both vehicles and properties.
Rising Insurance Rates
The heavy rains caused motorists to abandon their cars in flooded areas and rainwater seeped into residents' homes, causing damage. The report suggests that insurance rates, particularly for comprehensive motor policies, may increase as insurers review their pricing due to the higher frequency and severity of rainstorms.
High Volume of Claims
Local insurers are preparing for a high number of claims, with some experiencing a 400% increase compared to previous peaks. Many vehicles damaged during the rains may have only third-party insurance, leaving them uncovered for natural disasters such as flooding.
Managing Motor and Property Damage
Claims related to motor and property damage are expected to constitute the majority of losses for local insurers. Most UAE insurers have strong capital and liquidity buffers, which should help them handle these claims and minimize overall impact.