A new year can be the catalyst for new ways of thinking and taking advantage of opportunities, and sometimes that involves investing in something different. It seems that Dubai’s Roads and Transport Authority (RTA) is no exception, with the promise to procure 2219 new vehicles as part of an expansion of Dubai Taxi Corporation’s fleet.

We found it fascinating that 1775 of those 2219 vehicles are “hybrids”, and when you consider this number against the 4000+ already in existence, this equates to a 71% “friendlier” DTC fleet in the eco sense.

The UAE hybrid market is an interesting one: especially when you consider this is a “fuel rich region”. The government, however, has a set of “green goals” and in support of these, has led the way in the purchase of both hybrid and full electric vehicles for some of its departments. It seems that part of the recent RTA decision was influenced through the findings of a trial in which hybrid vehicles had either a significantly lower, or no, requirement for major maintenance or defect repair, despite covering in excess of 550,000 kms. When this is considered alongside lower running costs, it makes for a compelling case to switch.

In our experience, hybrids cost on average 10-15% more to insure than conventional counterparts: with the inflated costs attributed to the restricted availability of “aftermarket” repair parts and a higher retail replacement value for the vehicle itself. This combination results in higher claims costs for Insurers which in turn drives a need to charge higher car insurance premiums. The conundrum for consumers is therefore whether to absorb higher purchase and insurance costs in return for a reduced running cost. Overall, and dependent on personal circumstances, hybrids could end up to be a clear money-saving option.

We hope this has “fuelled” your curiosity to know more about the cost of “going greener”!

About Author

Rachel Al Mughairi

About Author

With over 34 years in the international insurance industry in a variety of senior management roles, and as holder of the Diploma in Insurance from the Chartered Insurance Institute, Rachel surely knows her insurance! With experience in London, continental Europe and the Middle East, Rachel is here to share her knowledge and help you understand more about insurance products in this easy-to-understand series of videos and blogs.