Looking for Home Insurance in UAE?
Greetings, and welcome to the blog section on Insurance Hub.
When I recently met a friend, he was looking happy but had a lot of questions on his face. When I asked, he said he was about to buy a house but was wondering how to choose the right insurance for his new home.
He did not know whether he needs insurance in the first place. So, I thought to educate him about buying home insurance in UAE and buying the right one.
In this blog, I am going to talk about buying the right home insurance in UAE and will also provide ways to choose the best home insurance that will meet your needs.
It is going to be a comprehensive buying guide which will educate the reader about various components and facets of property insurance and also enable him to find and choose the best.
Insurance Hub brings to you the best home insurance policies available in the UAE and lets you compare and select the most suitable one for your home.
To start with, we will talk about the various components of property insurance that you must know. In the following articles in this blog, you will find more topics covered when it comes to buying home insurance in the UAE.
Let’s talk about the very basics in this article.
Components of Home Insurance
In the UAE, it is mandatory to have your home insured. If you are looking for a home mortgage, proper insurance is a must too. Hence, if you own a home in any part of the country you must get insurance for that property, without a miss.
There are mainly three components or parts of property insurance that you must consider while choosing the correct one for you and your home. The type of insurance that you need will depend on how you intend to use the property.
The three main components of home insurance are:
- Building
- Contents
- Belongings (personal)
Let us look into these, one by one.
Building Insurance
A building is defined by the structure that you have built using brick, mortar, concrete, or other material and which is roofed or has a terrace as a cover. Often, the material used to construct the building should be incombustible, and strong enough to withstand accidental damages like natural hazards, problems induced by water like seepage, or a general fire.
Often, extended parts of the building like a swimming pool and garage, is also included in the cover.
A Building Insurance will cover the primary structure on which your home is built and hence, all these extended sections can also be included in your home insurance.
Owner’s Liability Benefit
It is an explicit liability or accountability cover for homeowners in which the building owner is also covered for any accidental injury incurred due to a third-party person or damage to a neighboring home or property.
While purchasing your home insurance, you must check if Owner’s liability benefit is included by default or it has to be separately purchased. On Insurance Hub, you will be able to compare several home insurance policies with various components, and you will have the option to check if a particular insurance policy that you have chosen has this benefit or not.
Sum Insured
The sum insured is also known as the value of the building. However, the sum insured is often confused with either the original purchase price of the building or the current market value of it. It does not represent any of these two.
The value of the building or the sum insured is the cost that the property owner will incur if the house has to be built again, in case of any substantial damage to the property, resulting in a total loss.
For example, if there is a natural calamity and the house is washed away, or if the house is completely burnt down due to a fire, there will be a total loss on that property.
In such a case, the sum insured will be the amount that will be needed to rebuild the house.
Tenant’s Liability
In case of houses that you purchase for investment purposes, where you do not stay yourself, but have given it out on rent, there is something called tenant’s liability. Such houses are called residential investment properties and the building insurance for such properties provide the same cover, except the damages induced by the tenant.
In such cases, most landlords or house owners want their tenants to have separate home insurance which covers damages caused by tenants, which is also called tenant’s liability.
All Risk Commercial Insurance
Now, commercial properties are different from residential properties, and it is very well understood by everyone. The risk involved is different in the two types of properties, and hence, the insurance parameters also are different.
Similar to residential properties, commercial properties also mandatorily need property insurance in the UAE. It is guided by the government and is the same all over the country.
If your property is a commercial one, you need to purchase All Risk Commercial Insurance policy. On Insurance Hub, you can find out various kinds of such policies. You may also want to call us at +971-26798289 if you need specific information about property insurance policies.
If you are renting out your property, you need to insure the building. Otherwise, you need to insure all the “contents” of the property.
Now, let’s talk about Contents Insurance.
Contents Insurance
When you insure your home in the UAE, along with the building, you can also insure the contents. Contents are nothing but the household items that the building contains.
In a Contents Insurance, you actually insure the household items such as furniture, home electronics, and appliances, kitchen utensils and appliances, interior decorations, etc. and this is not an exhaustive list. You insure all these items against accidental damage, theft, natural disasters, fire and similar loss incurred when the contents are inside your property or house.
Sum Insured
The total sum insured in case of contents insurance is also similar to that of Building Insurance. It means that the full value of all the items owned inside the home or the property is the cost of replacing all the contents in case of total loss due to an unfortunate incident, such as fire or natural calamity.
When to buy Contents Insurance?
If the house was built for staying in, or to be given away on rent as a fully furnished property, then buying a Contents Insurance is a must. However, if you are looking to give it on rent as a non-furnished house, then there is a different way to insure it.
On Insurance Hub, you can find policies which offer Contents Insurance and have various coverage schemes based on how you are going to use the property. Please feel free to browse through and check them out.
Let’s now talk about personal belongings insurance.
Personal Belongings Insurance
As the name suggests, Personal Belonging Insurance is typically for contents of the house which belong to the person or the family staying in the house. Personal belongings can also be considered as contents but represent clothing, jewelry, wearables, and personal gadgets and are not limited to coverage from damage that occurs within the home.
Personal belonging insurance covers all the personal or individual items that the people living in the house carry frequently when inside or outside the home. It may include but again is not limited to various personally used items like clothing, jewelry, and gadgets like watches, laptops, mobile phones, etc.
In the UAE, many insurers will extend the coverage of such personal belongings taken outside of the home for up to ninety days. Also, it is mostly active worldwide, which makes this extension exceptional for travelers who frequently carry expensive personal items when in travel.
Sum Insured
Again, the sum insured in a Personal Belongings Insurance depends on the total current value of the belongings, which means the full amount that would be needed to replace all these items in case of complete loss.
If you compare the premium amounts of buildings or contents insurances, you will find that the premium for Personal Belongings Insurance is often the highest. It also increases the total premium of your home insurance drastically, when the total value of the personal belongings exceeds that of the contents of the house.
When to buy Personal Belongings Insurance?
Personal belongings insurance claim is the most in the entire UAE. People often lose items like watches, mobile phones, and laptops, and other portable devices, claim for insurance. A low percentage of claims about jewelry are also registered every year.
It is recommended that you purchase Personal Belongings Insurance if you have a lot of items which are highly valued and which you often carry outside your home when you travel.
For a frequent traveler or globe trotter, such insurance is a must. If you travel with costly personal belongings, you may also go for Personal Belongings Insurance as a mandate.
Conclusion
I want to close this article with a few essential points which are very beneficial to you, and you must keep these in mind while dealing with home insurance in UAE.
Additional Insurance Benefits
When you purchase home insurance in the UAE, there can be some other additional insurance benefits which you may want to avail. Various insurers have various additional insurance benefits and covers which are specific to them.
On Insurance Hub, you can find all the information about such additional benefits that come along with various insurance plans.
Loss of Rent Insurance
Check out for Loss of Rent or Alternate Accommodation Insurance which provides insurance coverage to landlords in case of damage to the property to the extent that the property becomes unfit to live in.
It is essential to know that the Loss of Rent coverage applies only to those owners who have rented out their property and do not stay in it themselves. Also, it only covers the rent income that the owner should have received otherwise.
For landlords or property owners who live in the house property, the Loss of Rent insurance covers expenses for a substitute lodging provision.
Insurance Renewal
Home Insurance needs to be renewed every year, and it is imperative to be alert while renewing your insurance. Please review your insurance policy before renewing it as there can be different new clauses incorporated in your policy during the past year, which you may be unaware of.
Review the coverage and assess if your property is still adequately insured under the new terms and conditions if any. An out-of-date value of your property can expose it to unnecessary risks.
Finally, I would suggest you check for various insurance plans available on Insurance Hub, compare them, and choose the best one that meets your needs and covers everything that you want to insure. The information is provided loud and clear on our website.
If you still need help or you are not very sure of what you are looking for, speak to our experts, and we will help you in every possible way.
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