For many, the UAE is a place they’ve come to call home but it’s not their birthplace or country of origin. It’s somewhere chosen to build a new life in and since many have been drawn here due to work opportunities, it’s unlikely that’s forever. With that in mind, rental, be it of accommodation, home contents or a vehicle, is both popular and commonplace, as when it’s time to leave, such items can just be left behind.
Transportation is a top priority for those looking to get around: especially in Dubai where life really is 24/7/365. Leasing a vehicle as opposed to buying one is a preference for many, and with numerous options available, consumers are spoilt for choice in the range of vehicles to sign up for. But what about insurance? Can you cover a vehicle that isn’t yours? Read on to find out how a lease car in Dubai can be insured.
There’s no hard and fast answer
Whilst the lease vehicle might be fast, there’s no hard and fast answer when it comes to insuring it. It’s all about the terms and conditions of your agreement with the company you are leasing the vehicle from. Some companies make it your responsibility to insure the vehicle: with strict stipulations on the type of cover you need to have in place. Others keep things convenient for the customer by including insurance in the lease agreement itself: the monthly repayment includes the relevant insurance premium so you don’t have to worry about having to make multiple monthly payments.
Check With The Lease Company Before You Enter Into An Agreement
Trying to cover the vehicle yourself could be consuming in terms of time and money so if the lease company offer insurance as part of your agreement it could be well worth considering, provided the rest of the terms and conditions stack up.
For example, all vehicles leased to clients by LeasePlan Emirates are insured. They detail both the insurance coverage itself and the corresponding terms and conditions both in the paper agreement and on their website under the “My Company Car” section. You can expect to see this from some of their competitors too, so if you are considering a particular company you can check their websites as a good source of reference.
If You Need To Insure The Vehicle Yourself
If you’re in talks with a lease company that don’t provide insurance as part of the agreement/deal, you’ll need to arrange insurance yourself. For this, it’s recommended to approach a reputable insurance broker. Trying to go it alone and find suitable cover yourself could just lead you in the wrong direction and you could hit a dead end! An insurance broker knows just which insurance companies to approach for cover and will keep you on the right track. Generally speaking, you’ll need a decent Comprehensive car insurance that covers own damage as well as Third Party Liability (the latter being the minimum cover mandated under law in the UAE).
What Are The Car Insurance Requirements For Leased Vehicles?
Car insurance for a lease car is somewhat different from insurance for a car that’s yours. Despite not being the owner of the vehicle, you’re obligated to buy a suitable car insurance policy covering it for certain risks. When you’re a car owner, you have the choice of which policy meets your needs and fits your budget, and could even elect to take out the minimum cover available. A leased car, however, will generally be required to be covered by a comprehensive insurance policy to meet both legal requirements as well as the lease company’s own stipulations.
Your lease agreement may also include some insurance that protects your lessor. It is commonplace for lease companies to purchase what’s known as “gap insurance” for leased cars. This is a specialist insurance that covers the cost difference for what you owe on the vehicle under the lease agreement and what your insurance company is offering to pay in the event of a total loss claim. The inclusion of gap insurance in a lease agreement helps protect the lease company from any financial losses incurred to repair or replace the vehicle.
How much is car insurance for a lease car in Dubai?
The price of car insurance is dependent on a number of factors, namely your driving history, experience and age, together with the vehicle’s attributes (value, performance, make & model, intended usage). Irrespective of whether you own the car or you’re leasing it, the criteria and considerations are the same.
The difference comes in the nature and level of coverage. Lease companies generally require comprehensive policies with higher limits and additional coverages such as collision damage waiver or increased excesses. So, dependent on what exactly is required, you may find the cost of car insurance for a lease car in Dubai is significantly higher than the cost of insuring one that you own.
Your lease agreement may also include some insurance that protects your lessor. It is commonplace for lease companies to purchase what’s known as “gap insurance” for leased cars. This is a specialist insurance that covers the cost difference for what you owe on the vehicle under the lease agreement and what your insurance company is offering to pay in the event of a total loss claim. The inclusion of gap insurance in a lease agreement helps protect the lease company from any financial losses incurred to repair or replace the vehicle.
