UAE: Wettest January in history causes insurers millions in losses
Source: Middle East Insurance Review | Feb 2020
Industry players have estimated that losses suffered by insurers arising from traffic accidents during the recent rains range between AED50m ($13.6m) and AED60m.
The unprecedented rainfall that the country witnessed during the first week of this year led to an increase in the level of rainwater which flowed through streets and inundated parking areas. The volume of rainfall had made January the wettest month in the UAE’s history.
The number of vehicles that were damaged, whether they were travelling on roads or stationary in public parking spaces, exceeded 3,000, reported the newspaper Al Khaleej. According to the Unified Motor Vehicle Insurance Policy, unless a weather pattern is declared a ‘natural disaster’ by a competent authority, insurers have to compensate policyholders for damages caused by floods under comprehensive motor policies.
Insurance expert Ahmed Khater said the value of the claims that insurers will incur in the subsequent period will rise without any doubt, given the increase in the number of traffic accidents, breakdowns and damage caused to vehicles. The insured losses could eventually lead to an increase in insurance premiums, especially on motor comprehensive cover. M
AED1 = $0.27