The UAE Insurance Authority recently introduced revised insurance tariffs which indicated a hike in the car insurance costs for motorists in the country. While you might have acquainted yourself with the new minimum and maximum caps on car insurance, your overall rate is also affected by a number of other factors – many of which you can control and others that you cannot. A quick look at these factors will not only show you how your premium is calculated, but also help you choose the best rates.
Below are some factors that go into the making of your final car insurance premium.

Your age and driving experience

Your age is one of the factors that determine your car insurance premiums. Whether you are under the age of 25 or a new driver with a license less than a year old, chances are you will be paying 15-20% higher on your car insurance premium. This is based on the premise that owing to the lack of experience, and given a statistical correlation between frequency of accidents and age, these groups are more vulnerable to accidents and mishaps.

Your accident and traffic fine history

If you have had a rough time on the road, been in accidents, received any tickets or violated any rules, you are soon to find yourself paying for it. Insurance companies take into consideration past claims that you have made and use this to calculate your final car insurance quote. The more you claim, the more your insurance company will assume that you are likely to claim in future, which drives your premium up. On the flip side, having a spotless driving record will make you eligible for a no-claims discount.

[Related: What’s really happening with car insurance premiums?]

Vehicle age and coverage

Your vehicle’s age is another vital factor that is used by insurers to calculate your final quote. Since a new car would be more expensive to repair or replace, you would need greater protection in the form of comprehensive coverage, to make sure you don’t have to pay out of your pocket. This broader coverage translates into a higher premium for new cars as compared to old cars which can be protected with the minimal third party liability cover.

Vehicle type and features

The type of car you drive also has significant bearing on how much you pay to have it protected. Luxury, sports or other pricier cars cost more to replace or repair, more so if they are rare and have expensive spare parts. Insurers also take into account the safety features and ratings of the car model which make it safer to drive and hence lower the premium. Cars with larger engines are relatively more expensive to insure.

[Related: Comprehensive and third-party car insurance explained]

Agency or non-agency repairs

This important point determines whether your car can be repaired by the official dealer of the car brand (agency repairs) or by an external garage appointed and accredited by the insurance company (non-agency repairs). The agency repairs option can be added to your policy at an additional cost, if not included in your existing policy.

Excess or deductible

The ‘excess’ or ‘deductible’ is the amount that you agree to pay out of your pocket, in case of an accident caused by you. If you choose to accept a higher excess amount, then your monthly premiums will be lower and vice versa.

Optional features

For all other add-ons or optional benefits that you would like to add to your existing policy, you will be charged a fixed amount for each. These may include off-road cover, international cover, roadside assistance, car hire, etc.