What is the Cost of Property Insurance?
When you consider all the damage that can happen to your property, the cost of the property insurance premium is a small price to pay. Based on a 2017 study by Souqalmal.com, the most basic coverage in the UAE is offered at an annual premium of 0.03 percent of the original value of the property and can go up to 0.05 percent.
What Is the Extent of Coverage?
Property insurance covers the cost to rebuild the physical premises of your property including the indoors, garage, backyard, gates, and fences in case of damages due to natural disasters, malicious acts, vandalism and so on.
The policy also offers coverage for third-party liability. This protects the homeowners against legal claims of physical injury to third-party or damage to another property. Another important feature of property insurance policy is loss of use coverage. The policy provides coverage for loss of rental income as well as alternative accommodation while the damaged property undergoes covered repairs.
What is Excluded?
Insurance policies are put in place to guard you against the unpredictable, and exclude wear and tear that occurs over time. Damages owing to gradual deterioration are excluded as well. It is, therefore, vital to maintain the upkeep of your property.
Leaving the property vacant or unoccupied for 45-60 consecutive days, or as specified in your insurance policy, could also potentially void your insurance coverage. This is because unoccupied properties are at a greater risk of sustaining damage due to perils such as weather, theft, fire or vandalism.
Looking for a More Extensive Cover?
Along with the physical premises, the contents of your home like furniture, home appliances and electronics are at risk of damage too in case of an eventuality. For this purpose, you can opt for an additional home contents insurance cover. Looking at industry averages, the cost of home contents insurance premium in the UAE averages 0.6 percent of the value of the items insured.
Additionally, a homeowner can choose the personal belongings cover to go with his property insurance. This cover guards your personal belongings like electronic gadgets, jewelry, cash and credit cards, items of clothing, accessories etc. that are regularly carried outside the house. Both these covers can be opted for individually, but are sometimes also offered incorporated in a comprehensive home insurance policy.