Home Insurance 101

03 December 2012

With the fast paced nature of expat life and the high rental rates in the UAE, it perhaps comes as no surprise that many properties in the region are not covered by Home Contents Insurance. However, the recent fire in Jumeirah Lake Towers has thrust this topic into the spotlight resulting in the number of people seeking to purchase Home Contents Insurance in Dubai soaring by nearly 2,000 per cent .

A recent survey by UAE price comparison site souqalmal.com has highlighted that 86% of residents in the country do not own the correct insurance, with 52% of those surveyed stating that they were not concerned about their lack of cover as they did not see it as a priority. More surprising however is that despite the low number of people owning home insurance, 95 per cent said they understood the value in insuring the contents of their home! These figures show a stark reality, one faced by the insurance industry worldwide – its value is understood but its priority is severely underestimated.

So why is Home Contents Insurance so far down on our priority lists?


The UAE is generally considered a very safe environment for expats; its low crime rate and secured residential properties create a unique atmosphere for residents. The Dubai Government website highlights this by stating that “home insurance is not very popular in Dubai perhaps due to the relative safety of the emirate from burglaries and theft.” It is only natural for people within this ‘bubble’ to forget about insuring the contents of their homes.


In 2008 the Real Estate Regulatory Authority (RERA) announced a legislation that forced developers to take responsibility for any structural issues with buildings for a period of 10 years after its completion. In addition, the developer is liable for repairing mechanical, electrical or plumbing related problems that arise from defective installations for the period of one year after completion. A landlord of a rented property will also have a certain level of protection in place, most commonly in the form of buildings insurance, but many tenants are unaware that this does not provide any protection for their possessions.

Legally, when a tenant signs a lease they are taking full responsibility for the property and any damage caused during their tenure. The tenant is therefore responsible for any damage incurred, including fire or water related – depending on individual contracts and its clauses – meaning tenants can rack up huge debts to their landlords. It is thus vital for residents to protect themselves in case of any accidents as they will not be covered!

In fact it seems that even those that have taken out Home Contents Insurance have drastically undervalued their belongings by almost half (44%). The Zurich UAE Home Appraisal Study conducted in 2012 found that, on average, the participants in the study underestimated the value of their home contents by at least a fifth, with estimates ranging from 22 to 66% below actual value, giving an average underestimation of 44%.

It will never happen to me

Perhaps the most common phrase heard by any financial advisor or insurance broker is often the hardest attitude to overcome.As Ambareen Musa, Founder and CEO of souqalmal.com says, “despite the recent spate of house fires in the Emirates which left some residents homeless, penniless and in huge debt, it seems the message still isn’t getting through. The majority of the people we spoke to still seemed to have the ‘it will never happen to me’ attitude.”

Whatever the reasons are for not having adequate cover, recent events have highlighted just how important it is. It is always best to be protected and not have to claim than to need it and not have it. It is highly advisable that if you are currently without Home Contents Insurance that you start investigating and assessing the level of cover that you require. In the meantime we have provided six steps you can take to provide an increased level of security for your home:

Reduce the risks that you are exposed to

  • Replace or professionally repair any appliances that spark, smell unusual or overheat
  • Make sure lamps or lights are not touching bedspreads, drapes or other fabrics
  • Test your fire alarm regularly to make sure it works

Ensure your contents are protected

  • Work out how much contents insurance you need so you’re not under-compensated if anything happens
  • Estimate the value of your contents room by room, take photographs and keep an inventory
  • Don’t forget the small items like DVDs, books, and clothes which can soon add up

Keep electronic copies of all your important documents

  • Passport & visa page copy
  • Driving license copy
  • Birth, education & valuation certificates

Ensure the single-article limit will cover your most expensive possession

  • Valuable items might include watches, cameras, music players, jewellery or sports equipment so make sure the single-article limit in your contents insurance is sufficiently high enough to cover those items
  • If any items exceed the single-article limit in your policy, ensure you specify this to your insurer so they can ensure you have sufficient cover in place to protect your valuables
  • If you are unsure of the value of an item, seek a valuation from a professional

Ensure your valuable possessions are protected - both at home and whilst travelling

  • If you travel often, opt for personal possessions cover which protects your possessions whilst you are at home or away
  • If you travel for long periods, ensure that the possessions cover provided whilst you are away lasts long enough

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