Despite the fact that almost half have suffered home damage, the vast majority of UAE residents appear unwilling to invest in a home insurance policy that might protect their belongings in the event of a disaster, according to a survey conducted by yallacompare, the Middle East’s leading comparison site.
The survey, which polled 382 respondents, found that just 10.9% of UAE residents are currently subscribed to a home insurance policy.
Of the reasons given for not purchasing home insurance, the most common answers included a perception that policies are too expensive, and a perception that there is no point in home insurance – both cited by 24.1% of respondents. Just 16.1% said that they would like to sign up for home insurance, but had not gotten around to it, and 11.7% were under the impression that home insurance is the responsibility of a landlord.
“These findings suggest that we have a lot more work to do when it comes to educating consumers on why home insurance is important. A similar survey conducted by yallacomapre in July 2017 found similar levels of home insurance penetration, but price was cited by fewer people (19%) as a barrier to purchasing a policy,” said Jonathan Rawling, CFO of yallacompare.
“Our answer to those who think home insurance is too expensive would be that, actually, it’s a bargain compared to the alternative of losing all of your belongings and having to replace them yourself. In 2016, we conducted a study that found it would cost at least AED 28,000 to re-furnish the average one-bedroom apartment in the UAE. That’s a lot compared to cost of the average home insurance policy sold on yallacompare – about AED 220.”
The results of yallacompare’s most recent survey also provided an argument against the notion that home insurance is pointless. Almost 40% of respondents reported that they had experienced issues at home that threatened their belongings. The most common issues included severe electrical malfunction (reported by 27.2% of respondents) and flood damage (reported by 11%).
“Naturally, a home insurance policy would provide protection for your belongings in these situations. You would be able to make a claim and be partially or wholly reimbursed for any items that you had lost. Over 40% of UAE residents value their belongings at over AED 50,000, meaning that protection in the event of a disaster would significantly ease a claimant’s financial burdens,” explained Rawling.
Of the respondents who had claimed on a home insurance policy, 18.75% said that the insurer paid out whatever was needed with minimal hassle. And 43.75% said that the process of claiming was mostly easy, despite some disagreements over the payout.