News Middle East16 Apr 2019

UAE:Insurers reduce deductibles in motor policies

16 Apr 2019

Insurers in the UAE are reducing the deductible amount in motor insurance policies, as competition intensifies for market share.

"Insurance companies operating in the local market are finally resorting to reducing deductible rates in competition in the sector," said Mr Adnan Elias, director of sales at Fidelity Insurance Services.

Mr Elias said that sales representatives are now focusing on alerting the client to reducing the deductible level when discussing the sale of a policy, according to a report by Emirates Today.

He added that some insurance companies reduce the deductible sum from AED1,000 ($272) to AED500 or less in some cases, pointing out that reduced deductible rates lure customers during negotiations in the purchase process.

"The competition between insurance companies on deductible levels and others is normal. It does not violate the law," said Mr Musa Al-Shawahin, CEO of Me Partners, an insurance and risk management consultancy.

Some insurers say that the deductible amount is based on actuarial calculations and point out that motor insurance prices have not fallen to levels that may affect the financial results of insurance companies.

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