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Tue 3 Mar 2020 09:04 AM

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How to ensure your car insurance in the UAE isn't a scam

Souqalmal.com has a list of tips to follow and traps to avoid when it comes to seeking car insurance

How to ensure your car insurance in the UAE isn't a scam
Image: AFP/Getty Images

Fraudulent agents collecting cash payments, policies being miss-sold, cheap quotes offered by forging driver details – unfortunately these are all everyday scams hitting those looking for car insurance in the UAE.

Price comparison website Souqalmal.com has a list of dos and don'ts when it comes to making sure your car insurance in the UAE isn't a scam.

DIY: Do it yourself

The best solution is to not allow any individual to represent you unless they are a regulated broker/aggregator or insurance company.

  • The price on the policy may be tampered with by the person selling you the policy, by adding a mark-up on it. This is not legal and should be reported if you come across anyone doing so.

Always ask for the policy document to be sent to you directly from the broker/insurance provider and insist that the price and car value is mentioned.

  • Paying cash to an independent insurance representative who never pays that amount to the provider. And as long as your policy has not been paid for you cannot make a claim.

Avoid cash payment and always ask for an official receipt from a regulated company.

  • Your policy gets cancelled by your agent without your knowledge and he cashes the refund while you are driving an uninsured car.

Do your own research and represent yourself when purchasing a policy.

According to Souqalmal.com founder and CEO, Ambareen Musa: “If it’s too good to be true, it probably is. Often when you shop around for car insurance, and are quoted different premiums for the same policy, the culprit can very well be your car value. An agent may be able to offer you a much cheaper quote by simply decreasing your car value. This would have serious financial implications in case your damaged car was to be declared a total loss by the insurer.”

When it comes to dealing with independent insurance agents, you can’t be too careful. “And that’s exactly why it’s better to be safe than sorry. Opting to deal with regulated brokers, aggregators and insurance providers is one way you can avoid being scammed. And no matter who you talk to always ask for a receipt of payment from the regulated entity the policy is being issued from.” said Musa.

She added: “As a car insurance buyer, you must exercise caution when receiving quotes, paying for a policy, and reviewing your policy documents.

“Instead of paying cash to an agent, you should pay the broker, aggregator or insurance provider directly and try to do so by bank transfer or credit card where there is a proof of payment.

“Insist on having the policy sent directly to your email address so a third-party agent cannot tamper with the details.

“You must also verify the authenticity of your insurance documents, and check the fine print to ensure that the car value hasn’t been altered without your knowledge.

“Basically do not trust any individual who is trying to sell you insurance via cash payment.”

Your checklist:

  1. Is this person or agency I’m dealing with a regulated entity allowed to sell insurance?
  2. Is the policy/quote being sent to me directly to my email from the regulated entity?
  3. Is the price on the policy the price I paid for? If cheaper, often brokers/aggregators or insurance providers would give you a discount, which comes out of their commission. Anything more than 5-6 percent of the price should be questioned.
  4. If I am paying by cash, am I giving it to the entity issuing the policy or to an independent person? It is best to request a payment link online to the aggregator site or insurance provider site and pay with your credit card.
  5. If you are buying your car through a dealership, always ask for the policy document to be sent directly to you including the price on it, and the official receipt not from the dealer but from the company issuing the policy. (Only a broker/aggregator or an insurance company can do so.)

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