How to get the best dining deals out of cashback credit cards?

 

The more you spend, the more you save! Unbelievable yet holds true and here is how you do that if you are smart enough. Enter Cashback.

Cashback is an offering from Credit Card companies that rewards you instantly for making purchases.

How does it work?

Cashback credit cards benefit the user by paying a percentage of the purchase you make. Not just purchases, using them in your favorite hotels, restaurants or any other experience centers in UAE can also save you some dirhams. So, the next time, you are swiping your card in a restaurant or purchasing the latest mobile phone, look out for the exciting cashback offers and maximize it.

Lookout before you Swipe!

Though it is exciting and absolutely fantastic to get some hard earned money back do note a few pointers that needs a closer look before you swipe.

Like any credit card, these credit cards are entitled with pre-determined limits which many people fail to notice. It is for the simple fact that these are in fine print and easy to ignore or miss out.

If you are a frequent visitor to restaurants, here are some credit cards that offer the best dining deals which could save you from spending more.

Citi Cashback Card:

With a minimum salary of AED 8000, you can avail this card which can provide a lot of cashback benefits while dining at your favorite restaurants. You can enjoy up to 20% discount at over 400+ dining outlets in the UAE. The redemption is automatic as well. No calls, no emails!

Dunia Finance Platinum Credit Card:

The minimum salary requirement is the same as that of the Citi Cashback Card. But Dunia finance offers free Zomato Gold Annual Membership when you opt for this credit card. It also offers hundreds of Buy 1 Get 1 (BOGO) offers from MasterCard throughout the Middle East and Africa.

Najm One Cashback Card:

This cash back credit card from Majid Al Futtaim Finance offers a lot of discounts on dining and entertainment. With this card, you can avail up to 30% discount at selected restaurants. They also make payments easy by providing card-less solutions i.e., Samsung pay.

CBD Visa Infinity Card:

The Commercial Bank of Dubai offers great deals on dining with this visa card. It has great dining privileges which include Dragon Pass, the World’s 1st all-in-one Digital Airport platform which lets people enjoy food at restaurants within the Airport. In addition to this, dining discounts in Premium Hotels in UAE can also be availed with this card.

Standard Chartered Platinum Credit Card:

The Platinum credit card from Standard Chartered lets people enjoy a wide variety of offers that includes offers up to 50% in popular cafes and restaurants. To be even more specific, it offers a Buy 1 Get 1 offer (BOGO) at all outlets of Costa Coffee.

 

A Dream Come True: Personal Loans without Salary transfer & Easy documentation

 

The growing trend in today’s lifestyle is opting for a loan that is readily available especially for the salaried class as it is seen as one of the easier targets to win over by banks. And how?

Enter Personal Loans with easy documentation, minimal fuss, and practically the money is in your hands within a day of application.

It is a fact that Personal loans are today available for every purpose heard and unheard of. Apart from meeting marriage expenses, emergency medical situations and tiding over the odd credit card overdue, you can opt for a loan to go on an overseas vacation, purchase one of the most expensive headphones and even take your valentine for a boat ride around the Dubai Marina.

Easy documentation and process

While banks in UAE demand other documents such as a valid passport or a UAE National ID, for an Expat, a valid residency visa is mandatory. The salaried or self-employed people have the option of showing their salary slips as it is one of the major proofs the banks seek in order to sanction a personal loan.

No more Salary transfers

Initially, some banks in the country had demanded people to create a salary account in their bank and transfer the salary to it. By doing so, the customer is benefited with exclusive offers, faster processing of loans and even a free credit card. But many do find the process tedious or some may prefer not to change their existing salary account.

Nowadays, UAE banks are offering personal loans to customers without mandating them to transfer their salary. This is commonly called as a Non-salary transfer loan. This is a hassle-free process and it doesn’t consume much time for banks to process since there is no salary transfer involved. But the income proofs need to be provided. Furthermore, these don’t require any collateral or guarantors.

Though banks do not mandate customers to give any collateral, do keep in mind the interest rates are mostly high when compared to other loans such as home, car or gold loans. The loan amount is purely dependent on the salary and the interest rates which vary from bank to bank.

Let’s look at various banks which offer personal loans without salary transfer:

Emirates NBD:

It is a National Bank in Dubai and the United Arab Emirates. It is one of the oldest and largest banking groups in the region. They offer loan amounts up to AED 500,000 for both UAE Nationals and Expats who have a minimum salary of AED 10,000. The repayment period offered is up to 48 months and the interest rates start from 14.99%.

Dubai Islamic Bank:

It is the largest Islamic bank in terms of assets and is the first bank to incorporate principles of Islam in all practices. People are considered eligible if they earn a minimum salary of AED 3000 which would get them loans up to AED 400,000. The repayment period extends up to 48 months.

Union National Bank:

One of the leading domestic banks in the UAE region which offers personal loans up to AED 200,000 for UAE Nationals and Residents. For this amount, the bank expects the applicant to have a minimum salary of AED 10,000. The repayment period offered is up to 12 months.

Citibank:

A subsidiary of the multinational company, Citigroup and is one of the famous banks in the UAE region. Possessing a Minimum salary of about AED 8,000 per month would get you a maximum finance amount up to AED 175,000. This bank is known for its fast approvals on personal loans.

Conclusion:

While there are several options for one to avail a personal loan in UAE. It is important to note that a clean credit history is essential for availing credit in the country. Hence, borrow if its required and ensure you make payments on time.

Credit Cards in UAE

 

Around 71 percent of affluent residents in the United Arab Emirates own more than one credit card as per the statement of a weekly report. The majority of the residents access credit cards while 64 percent of the public use them for a day- to -day purchases. Another 63 percent admitted using credit cards when traveling abroad.

When you pay with a credit card, you are effectively borrowing money from your bank or lender. Every month you receive a statement that lists all the transactions you have made, along with place, price and sometimes even details of the item.

When it comes to credit card balance transfers and savings in Dubai, it is always advisable to pay the full outstanding on your credit card each month to avoid unnecessary fees. Most banks offer a minimum promotion rate of 2.5 percent and up to 10 percent cash back on spends. The minimum salary requirement to apply for credit cards in the UAE is 5000 AED as per the rules and specification of the banks which may vary with higher or lesser salary rates depending on the lender. The facility of balance transfer is freely available for the first 6 months with a minimum of 2 percent processing fee. Banks offer foreign currency rates with a minimum of 2 percent based on the expenditure or purchases made. If you are a frequent traveller, you might want to make sure you apply for credit cards offering lower foreign currency rates. The annual fee on a credit card will be applicable on a yearly basis as a part of your statement. Some UAE banks advertise and state that they do not charge annually, but it is preferable to opt to pay the annual fees as it has many benefits to offer.

The Soul Wallet Savings Simulator is a financial tool developed to help customers understand which credit cards offer them the best opportunity to maximize their savings. This is done based on an analysis of the customer’s unique expenditure pattern both across the type of monthly and annual expenditure and also the amount spent on each category. The unique algorithms help you ascertain which credit cards offer you the maximum savings potential for your specific spend. This varies from individual to individual.

A frequent traveler will probably consider taking a credit card that offers air miles. However, if you don’t travel a lot but like to save on your transactions, you might prefer a credit card that gives you cash back. Also, cash back amounts could vary based on the total amount you spend in a month. Visa International, MasterCard and the different banks in the UAE offer additional benefits on premium cards, such as access to airport lounges globally, discounts on dining, valet parking, free golf, cinema discounts and other transport facility benefits. You can compare all the benefits on Classic, Silver, Gold, Platinum, Titanium, Infinite and World credit card benefits or choose to search for premium cards directly. Premium cards generally require a higher income or have a higher annual fee.

World Expo 2020: The impact it will make in the lives of an ordinary citizen

 

The Burj Khalifa in 2013 wanted to celebrate Dubai’s Victory to host the 2020 World Expo and this small but highly enterprising country did it in style and How!, by making a ginormous crowd of well wishers witness the fireworks from their tallest building that was telecast the world over!

It is a widely accepted and expected too that Dubai does everything in style and gigantic proportions. Dubai is leaving no stone unturned as this World Expo 2020 will be the first large-scale international event that is about to take place in the Middle East. An event with such magnitude will bring a lot of advantages for Dubai and UAE in general, especially for its real estate sector which has been pretty sluggish the past 2 years. 

Quick facts about the World Expo:

  • A once in 5 years mega event that is spread over a six-month period.

  • Almost 130 countries participate in this expo to showcase their inventions, according to the motto set for every expo.

What’s New and Trending:

5G network makes its debut:

Dubai will be pronounced as the first nation amongst the Middle East, South Asia, and Africa to unveil the future cellular technology – the much awaited 5G at this event. The technological aspects are said to run on this fast-paced network, as the event is set to attract around 25 million visitors. The people visiting the event will also be thrilled to view a 65m tall digital sphere wrapped around them that can display videos and pictures all around, which can also be enjoyed by the people outside the sphere.

Soon, 5G will be made available across the Middle East and every Smartphone user gains the advantage of it. 5G helps users with faster transactions, unlock new features and much more.

Enhancing Infrastructure:

For the mega event, the UAE Government started funding new road and rail links to manage the influx of tourists and the locals. The Dubai International Airport is about to have a 60 percent rise in the number of stands, as the number sums up to 230 from 144 which is currently present. In addition to this, floor space is said to increase to a whopping 675,000 square meters in the terminals. As estimated, this would accommodate the millions that are about to land here in 2020.

Many new hotel projects are in full swing to provide proper hospitality to every visitor. Dubai’s roads and transport authority announced that there will be an expansion of metro lines from Dubai Metro’s Red line to Dubai World Central. This is estimated to be worth of 1.36 billion USD.

These improvements will be of huge benefit to the citizens as these will be considered as enhancements around them which will ultimately profit them.

Positive effects on the property market:

According to a report in 2018 [Source: JLL Real Views], the real estate market in Dubai witnessed slow growth with global currency and oil prices also taking a beating which further contributed to the fall in the real estate market.

But this could drastically change, as the event will rope in a lot of supplies to the market which would be a long-term investment for the country.

Life after the Expo:

Unlike other countries, Dubai has a Vision to use the Infrastructure of the Expo as a home to millions of people in the UAE. It aims at giving well established, affordable homes with family-friendly amenities that can enhance the quality of life.

Around 120,000 new homes are about to be built by 2020, with new developments around the site. As the site is positioned as a residential community with three economic sites – Dubai World Central, Kizad and Jebel Ali Port, it is expected to bring in a residential investments as all the necessary facilities and infrastructure would already be available.

This will be home to 1 million residents and 500,000 jobs with Developers already initiating to transform certain important tourist sites that include the Dubai Water Canal, Museum of the Future, Deira Islands, Dubai Theme Parks, Jewel of the Creek and other projects.

Are you too young for life insurance?

 

Are you too young for taking an insurance policy? It’s a good question that was posed to many a teenager and most of them responded with, “I am healthy. I am alive.” Unfortunately, they do not realize life is uncertain. A 2017 survey conducted by Insurance quotes.com has proved this statement and it was found that 65 percent of the young adults do not own life insurance and almost 71 percent of them said it wasn’t necessary for them because they are healthy. 

Awareness is key

Many parents in the UAE are not aware of the fact that they can enrol their toddlers for life insurance, which is the best way to safeguard their children. There are a lot of protection plans for children. Right from the age of 1, they are eligible for children protection plans which cover their education as well as their health. They are designed in such a way to help a child’s future education needs at a minimal premium.

In the past decade or more, many insurers have devised policies that offer insurance right from the tender age of 1 till the age of 75. It is heartening to notice that families are opting for this.

Many may ask why a one-year-old child needs life insurance. An insurance policy taken by the head of the family for his children is definitely not for the money that he can bag if some untoward incident happens to the child but, for the simple fact that premiums are far lower at that age compared to anyone taking a fresh insurance policy at the age of 30 or 40 with ailments or diseases always around.

The other reason that insurance is recommended to be taken at a young age is, there are many benefits that come with that. It could be a free health check-up, scholarships or even can stand as collateral or a good credit score.

Pay the premiums on time every time

You can consider taking a whole life insurance policy, which can back you up as long as you pay the premiums. You can select the mode of premiums which can be paid either monthly, quarterly or even annually depending on the monthly earnings of yours.

The basic Whole Life Insurance policy can be considered though other options are available. As you get older, you will have a lot of other requirements that need to be protected. Anything as such can be covered by adding riders to your existing policy.

To summarize, life insurance policies are a must for every individual and nobody is considered too young for a life insurance policy as there is one for everyone. By obtaining more knowledge about the policies, you can be able to narrow down on the list of policies according to your requirements and for your family.

Quick Steps to Stake a Claim for Auto Insurance in UAE

 

Making a claim for your automobile can be a nightmare if it’s your first time. The negotiations, the white sheets that you need to sign and the different terms that are mentioned in them can make you very stressed adding to the the stress of an auto accident you are already in.

Furthermore, you can also have issues with your Insurer whether they are doing the math right and not safeguarding their interest only. Before landing in such a situation, having some knowledge can help you get through it.

Here are some of the things you need to know before making a claim for auto insurance:

Know what’s covered:

It’s best to know what your policy covers. This gives you a whole idea of what can be claimed and what cannot be. Do go through the policy thoroughly (even the small print which everyone tends to ignore or skip as it is too fine a small print).

Next, the terms that you must be aware of:

Insured Declared Value (IDV) – which is the amount the insurer promises for your vehicle which changes every year at the time of renewal.

Zero Percent Depreciation Value – Check whether the insurance policy has this line, which means there will be no depreciation to your vehicle’s tires and alloys.

PA Cover – This specifies an amount that can be claimed if the person is injured or dead in an accident.

Required proofs and documents:

  • The police report is mandatory after an accident

This is a mandatory document when you happen to be in an accident and there are any casualties from your side or to the other person who was involved. It is to be noted that in Dubai, a mobile application called the “Dubai police mobile app” can help you file a police report in a simple and easy way.

This report will be required by both the police and the insurer, as it covers the details about the accident as well as the exact information of the party/parties involved.

  • Vehicle registration certificate:

This is one important proof which details about the vehicle from the purchase date to the engine number.

  • Driver’s license:

As everyone knows, this document is the ideal proof which specifies whether a driver is legal to drive or not. The legal age for driving in UAE is 17.

Informing the Insurer as soon as possible:

Before making a claim, you need to inform the insurer about what exactly happened. This is the most important step before making a claim. This will make the insurer prepare documents necessary for the recovery. It would even better if you can take photos of the accident spot, the damages to your vehicle/other party and their vehicle thus ensuring there is a chain of evidence that is not mixed up.

You will be asked by the insurer to submit the police report and the policy number that can be found on your registration card. You will need to fill in a claim form provided by the insurer which will take care of the claims promised by them. After analyzing your policy and the damage that happened, the insurer would take the necessary steps.

The insurer would ask you to go to the nearest service center and give the vehicle for repair.

From this point onwards, the insurer would take care of the process.

Do not sign any documents without any prior knowledge:

Always clarify before signing, what the document is and what terms is being stated. You can approach the insurer for a better understanding of the document if in doubt.

Keep the documents for future reference:

Always keep proofs such as pictures and documents of the accident that took place in a safe place, as you might need them for future reference.

Though the Government makes every effort to ensure there is no mishap or accident involving vehicles or persons, it is unfortunate that these do take place and it is prudent to be safe than sorry. Be insured and be safe. Always

Top 5 reasons to use a credit card

Credit cards are now a necessary accessory for most Dubai residents, as it not only makes shopping easy, but they also serve as a backup when there is a need for immediate purchase. Using them for online transactions can save money by availing cashback, discounts. Every credit card has its own perks and you can opt for one based on your lifestyle and usage.

Here are the top 5 reasons why you need a credit card:
Easy instalments:

Between paying your house EMIs, Insurance, Groceries and fuel, this could drain your salary to a large extent leaving you with enough to barely save for the rainy day. Enter Credit Card. Credit Cards is one perfect alternative to save your money, as many credit card companies/banks provide instalments with lower interest rates. Some banks even offer zero percent interest for certain products. Most people even prefer this to easily manage their monthly expenses.
Banks provide you with flexible interest rates and duration starting from 3 months to even 2 years. This benefits customers to pay their instalments without hurting their pockets.

Maximise on cashback:
With the trending cashback offered by companies or credit card companies at the time of making a purchase, it gives an extra recharge to the card owner who feels he is getting more value for money. Say, for instance, if your credit card offers a cashback of 10% on fuel, then for every 100 AED spent on fuel you would be credited with 10 AED in your coming statement. But these cashback depend on the type of card the customer holds, as every card has its own value.

Travel with air miles and avail travel discounts:
If you are a frequent traveller, mostly by air, then credit cards can help you save money on your travel expenses too. Air miles can be accumulated to avail discounts on your air tickets, redeem them for retail vouchers etc. Surprisingly, you can even fly to your favourite destination for free if you have accumulated that many miles. Other perks might include complimentary airport lounge access, discounts on accommodation or even hire a private car for a very good deal.

Exclusive offers and reward points:
With the right credit card, you can avail terrific offers to not just products but also to services such as spas, and restaurants. Some offers are exclusive to certain cards, like the platinum cards offered in many banks. Banks also have their own apps that provide these exclusive offers to their customers which includes services like booking a movie or a resort maybe.
Apart from offers, banks also offer reward points to customers which can be redeemed later with any other products like phones, watches or even bigger items like refrigerators and air conditioners for free or for a discounted price. Banks actually started this scheme for customers who use credit cards often, thus to make them their regular customers. But one should make sure to use the reward points before it gets expired.

Savings on entertainment:
Since leisure activities have grown by leaps and bounds, even a simple outing like a movie and a lunch will dent the wallet. Using a credit card at movies, entertainment zones and paying for your yummy snacks, you can get discounts for all of them to make your day .Even some credit cards help you get offers like free valet parking in malls and restaurants.
Don’t miss out any offer that you get from card companies and never forget, Customer is always King in UAE.

Auto Insurance – What to look for while shopping?

 

Some tips before buying an Auto-Insurance policy

According to the UAE RTA law, it is mandatory for all vehicle owners to get an auto insurance cover, which can serve as a helping hand for you in case of any calamities.

Everyone knows how to buy an insurance policy or renew one. But, before you end up buying one, ask these questions that will help you zero in on the best policy for your car and wallet.

Know your Insured Declared Value (IDV)

Abbreviated as IDV, it is the highest value that the insurer guarantees the customer in case of theft or complete damage to the vehicle that can’t be repaired.

Simply put IDV = Manufacturers listing price – Depreciation value.

The manufacturers listing price denotes the ex-showroom price of the automobile, which doesn’t include the registration and other add on costs, whereas the depreciation value refers to the loss of value of the vehicle with time.

Within six months of your purchase, the value depreciates by 5% which leaves you with 95% of the amount that can be claimed. The depreciation rate rises every year as the vehicle is subjected to wear and tear.

Look for a B2B cover and comprehensive cover:

Don’t forget to select the Bumper-to-Bumper add-on, as it adds zero depreciation value to your vehicle. This means that the insurer is liable to pay the total cost for your repairs. Even though it is a bumper-to-bumper policy, the engine and the gearbox do not fall in this bracket.

Another important fact we fail to note is that the B2B coverage is valid only for a period of 5 years, even if you renew it again. This is basically the strategy of insurance companies to minimize losses.

Comprehensive insurance would cover your vehicle if it is destroyed, stolen or even dented. It is an add-on as well.

Opting for this insurance keeps your car insured even when you drive to countries such as Oman, Bahrain, Saudi Arabia, Kuwait, and Qatar.

Understand about third party insurance and its coverage:

Third party insurance made mandatory by UAE is a plan that covers the damages caused to an anonymous person, vehicle or property which includes grievous injury, disability, and death.

Reduce your premium with No claim discount:

No-claim discount (NCD) is offered by insurance companies to the customers as a percentage of the own damage premium as a reward if they didn’t make a claim. 10-20% can be claimed while renewing and if they have a good driving record, the insurer can even offer a discount of up to 50%.

For instance, if you have made zero claims for your car and you’re planning to buy a new one. Then, the bonus that you have earned with the old car can be used to reduce the premium for the new car to a certain extent.

Personal accident covers:

Personal accident is usually an add-on cover with a car insurance policy which can be purchased by paying a certain premium. This provides you with adequate protection for physical loss or disability which can also help you out financially.

And finally,

Comparing premiums:

Having discussed other factors, the last part and most important factor is – price. Many insurers differ in cost and there could be policies that are sold cheap. Compare, keeping in mind the above factors before you pay.

Go for an Auto Insurance policy which meets all your requirements and benefits you the most.

Life Insurance – Why do you need one?

 

Allow me to tell you this interesting fact. According to Friends Provident International (FPI) Survey conducted by YouGov in 2018, 51 percent of UAE residents do not have a Life Insurance!

Of this lot, 36 percent said it was too expensive while 30 percent of respondents were not familiar with the concept of life insurance. Another 39 percent said they were not familiar with critical illness insurance.

The future is undoubtedly unknown and anything might happen as we hear and read people die of sudden illness or a prolonged illness or even meeting with a fatal accident leaving their family financially unstable or in some cases in ruins.

So, what is the best way to safeguard them?

Taking a Life Insurance Policy is the answer for you.

Even though paying premiums for life insurance policies can be expensive, the support they provide at critical situations eases and make us realize that the monthly installments paid are never a waste.

Read this article to find out….

Securing your family and your hopes:

Opting for life insurance can your safety net in times of any financial emergency, be it paying for your child’s education or assisting your spouse financially even if you’re not there to help them out.

Essential Benefits Plan (EBP) is the most basic health insurance plan for the residents of UAE that offers coverage to any treatments, emergencies or even maternity. This has been now mandated by the government for every citizen in the country. It has an annual claim limit of AED 1,50,000.

For non-working dependents:

SANAD Health Insurance plan is only for non-working dependent individuals carrying a Dubai resident visa. It won’t be requiring any eligibility checks, declaration or medical history. You only need the proof for dependency for approval of the SANAD program which will be activated through the Emirates ID of the individual insured.

Critical illness, on the rise:

A study claims that the average age of critical illness in Dubai is 48 as of 2018 [Source: Gulf News]. Despite owning general health insurance, the need for residents to opt for an income protection plan is inevitable.

Critical illness cover is a living benefit to customers being diagnosed with a predefined illness such as cancer and bears an age limit of 59 to avail one. It helps them meet other requirements such as rent, cost of travel for any advanced treatment than the most expensive, treatment costs and medication which will be taken care by the general health insurance policy. You may not get the whole benefit from the insurance company if your critical illness is caused due to:

  • Any genetic disorder

  • Tobacco or drug abuse

  • HIV infection

  • Self-intentional injuries such as suicide

Flexible for your needs and saves taxes:

There are three major types of insurances offered:

  • Level term insurance provides protection for a specified period. It will expire and the coverage will end if you outlive your policy.

  • Whole of life term pays out a lump sum whenever you die. It is expensive when compared to level term, and it pays out premiums till the age of 95.

  • Decreasing term puts forth similar conditions as level term insurance, but the amount reduces as the policy matures which makes it the cheapest of the three.

The policy which we feel is more credible can be chosen.

Irrespective of what plan you buy, you can save taxes by enrolling in a policy.

Life is uncertain: 

You may be young and healthy now but if you suddenly fall ill, you may not be eligible for a Life Insurance policy. Therefore, it is important to buy one when you are young because it remains in force if your health deteriorates later on.

Riders, which are add-ons can be selected to personalize your policy. For instance, the accelerated death benefit rider allows the policy owner to avail a portion of the death benefit coverage for any treatment purposes on submission of medical bills to the insurance company.

Top-ups can be another option which covers all treatment costs other than riders which cover the same for only a few illnesses. They also carry a cheaper tag and needs to be bought separately other than the Essential Benefits Plan (EBP).

To sum it up, investing in a life insurance policy at an early age gives a host of benefits, reduced premium and tax savings too. Of course, the peace that your family gets knowing the earning member and others are insured is beyond compare.

Car Insurance – Know the jargon..

The Insurance world is filled with special terms or expressions that only a few outside of it might truly comprehend. It might be difficult as a policy holder to understand what is really being communicated by the Insurers when they use these jargons that fly right over the top of your head. Thus, we bring to you a comprehensive decoded list of jargons used in the space of car insurance, which can aid you to better understand your Insurance policy and communicate effectively with your insurer.

Insured Value: This is the amount of money that your car is valuated at. Suppose you buy a car worth Dh 90,000. Your insurer might only offer you a cover of up to, let’s say, Dh 80,000. This means that even if your car is worth more, you would get only Dh 80,000 if you write your car off. Most people tend to under-insure their car to save some money on their insurance premiums. However, it is always advisable to Insure your car for as much as its true worth is.

Adverse Selection: Though this is a term that you would not encounter as much while applying for insurance, it is worthwhile knowing what it really stands for. Insurance companies keep a tab of the different kinds of people buying their insurance policies. To bring about an analogy, consider the case of health Insurance. A random 20-year old healthy person might think “Why should I pay Dh 200 every month towards Insurance when I am fit and fine. I don’t need a policy”. On the other hand a 70-year old ailing person might feel, “Wow. I pay just Dh 200 a month and all my bills would be taken care of. I am definitely buying the policy”. This kind of “adverse selection” by the population might put the Insurers at great risk of incurring huge losses as they must make frequent pay-outs towards claims. Thus Insurers carefully analyse the profile of a customer like driving history, traffic records and other factors while selling insurance policies.

Agency Repair: Authorized car dealers and service centres usually charge higher than others for spare parts and servicing of cars. So, if you want an Insurance cover that pays for such services, you would have to shell out a little more for your policy.

Excess: While making a claim, the entirety of the amount quoted by the service centre for repairing your car will not be settled by the Insurer. A small amount of money should come out of your own pocket, (called as ‘Excess’), before your Insurance kicks in. However, you can control this amount by choosing to pay a higher premium.

No claims discount: Suppose that you have not made a single Insurance claim in the past year. Your Insurer acknowledges this fact and provides you with a discount on your premiums for the next year. This is called as a ‘No-claims discount’.

Third Party – Liability Insurance: This is the minimal form of Insurance required for any vehicle. Through this Insurance, the provider pays only for damages to a third party caused by your car. Damages to your own car will not be covered. Every other form of insurance, such as comprehensive policy, comprehensive with add-ons, etc., builds on top of the Third party-liability insurance.

Depreciation: Your car’s insured value will not remain the same for the entirety of the period for which you wish to insure. Every year, the car will be devaluated by a fraction of an amount keeping in mind the age of the car and the associated increase in maintenance of the vehicle.

Black box: Although not fully implemented in the UAE, the Blackbox is a device that would be onboarded on your vehicle by the insurer to measure how you accelerate, brake and monitor other driving habits. This will in turn determine future aspects of your policy.

Foreign Extension: If you wish to keep your car insured even while you drive out of the country, you must purchase the foreign extension add-on of a policy for an extra-cost.

Totaled: If the estimated cost of repair costs exceeds the value of a car, then the car is considered to be ‘Totaled’ and the Insurer will pay out the market value of the car to you.

Indemnity: It is the basic principle by which an Insurance holder is put at the same financial position as before the accident had occurred.

Modification: You might have made modifications to your car such as to the suspension systems, wheels, exhausts, windows etc., and these will not be traditionally covered by the insurance company. The modifications will have to be declared to the company before you purchase the policy.

Annual mileage: This is the number of miles that your car is expected to cover in a year. This number in turn affects the costs of your policy.

This article covers only the major jargons used by Insurance companies. We advise you to read the policy document and refer other sources to fully understand all the terms and conditions of the policy. Happy Motoring!