Insurance will never be able to replace those items of greatest sentimental value such as photos and other mementos which we all collect during our lives. It does enable us to trade a possible future event of unknown financial magnitude for a fixed value now, protecting us from financial loss.
Good quality home insurance is seen as an essential part of everyday life in many parts of the world. Why then do so few expatriates take up this type of insurance? We have seen several high profile fires that have swept through towers in Dubai Marina and other places. Often the people living in these apartments are left homeless having lost most of their possessions.
Home insurance has two main elements. The building and the contents of the building. Tenants would not be expected to insure the building just as landlords would not be expected to insure the possessions of their tenants. Consequently, most insurance companies offer stand-alone contents insurance for tenants and stand-alone buildings insurance for landlords. Owner occupiers can have a combined plan.
Landlords of apartments have a collective responsibility to insure the whole building. This should be arranged by the owners’ association or the building committee. When buying a property in a block a potential purchaser should make enquiries about the existence of adequate insurance and how it is paid for. Owners should then make sure the policy remains in force and premiums are paid on time.
Tenants are naturally more concerned about what is in the property which, unless it is let fully furnished will be their belongings. A good quality home insurance policy not only covers your belongings within the property but also when you take them out of the insured property such as when you are on holiday. Another common worry for expatriates is loss or damage happening when they move home. Some policies provide cover in this situation too.
Valuables such as watches and jewellery are often worn outside of the home but will be covered against loss or theft by most home insurance policies subject to certain terms and conditions. Typically, the insurance company will need to be notified of belongings valued more than a certain amount (AED10, 000 is a common level). Valuations or receipts will be required for these items when you take out the insurance.
Often insurance claims are not due to malicious acts such as theft or arson but could simply be due to accidental damage. Fortunately, accidental damage is also included in several policies available in UAE.
In addition to the need for basic buildings and/or contents cover. Home insurance plans also offer Employer’s Liability insurance for the householder where domestic helpers are employed; Personal Liability insurance should a visitor hurt themselves whilst on the property and Tenant’s Liability insurance which covers the tenant in the event of loss or damage to the property or fixtures and fittings of the property they are renting.
I hope you found this information useful. Please let me know if you would like to know more about Home Insurance or any other financial matter.