Standard Policy Structure & Requirements

Third-party motor insurance, more often referred to as liability insurance, is a compulsory type of the policy under which the insured is protected from the claims of a third party for damages or injuries caused by their vehicle. This type of policy usually takes care of bodily injury and damage to property of another party which is caused by the insured vehicle.

In the United Arab Emirates (UAE) the common third party motor insurance policy stands as the model structure and sets the requirements for this coverage type. The insurance companies have to follow the directives that are given by the Insurance Authority in order to maintain homogeneity and impartiality within the market.

Regulatory Framework & UAE Laws

The regulations governing third-party motor insurance in the UAE are under the watch of the Insurance Authority and the UAE Federal Traffic Laws. The laws instruct that all motor vehicles must possess valid third-party insurance coverage in order to drive legally on the roads.

The noncompliance with these laws could lead to huge fines, confiscation of vehicles, or even legal action. It is very important for all vehicle owners to learn and adhere to the rules so that they will not incur any penalties.

Are All Insurers Required to Use It?

Despite the unified third-party motor insurance policy which sets the coverage standard and requirements, not all the insurers are mandatorily required to follow it. Nevertheless, a majority of the insurance providers in the UAE have this type of policy as a means to regulate themselves and fulfill the needs and expectations of their clients.

The most important thing for vehicle owners is to compare the different insurance companies and their policies in order to obtain the best insurance coverage at the most affordable prices. Knowing the criteria and the choices they have, individuals will be able to act wisely while buying third-party motor insurance.