Home Insurance in Dubai: A Complete Guide

Understanding home insurance in Dubai

While the concept of home insurance in Dubai may have certain similarities with global standards, it is recommended to carry out your due diligence and understand the local home and property insurance policies - and how they may impact your investment. 

In Dubai, home insurance, house insurance, homeowners’ insurance, and property insurance are often used interchangeably and have the same meaning. Simply put, home insurance in Dubai, or property insurance, is a financial strategy to safeguard one’s home from various risks. 

For many investors who have bought properties in Dubai, home insurance is not just an option - but an integral part of their investment, as it protects them from unforeseen circumstances that can impact their property and finances. Additionally, property insurance also protects a homeowner’s personal liability claims arising from property-related accidents. 

Types of home insurance

Home insurance in Dubai comes in different types, catering to the varying property types and needs of a homeowner. Understanding the different types of home insurance in Dubai will give you clarity on the right option for you. 

The types of home insurance policies in Dubai include: 

Building insurance

This subset of home insurance in Dubai covers the physical structure of one’s property, such as:

• Roof 

• Foundation 

• Walls 

• Structural components 

• Built-in fixtures 

Building insurance protects a homeowner and their property from various risks, including lightning, earthquakes, theft, vandalism, fires, and other natural disasters. Basically, it covers a property for any kind of damage that could potentially impact its structural integrity. 

This is an important kind of property insurance for homeowners, as structural damages can cost a pretty penny to repair - and building insurance can provide some amount of financial relief to the homeowner. 

Contents insurance 

Contents insurance is a policy form that protects a homeowner’s personal belongings that were inside their property during an incident. The kinds of content that can be insured include:

• Appliances 

• Furniture 

• Jewelry 

• Other valuables 

Similar to building insurance, contents insurance also provides coverage for incidents such as natural disasters, theft, and vandalism. Moreover, contents insurance provides coverage for both the damage and loss of a homeowner’s personal property - making it an essential form of home insurance in Dubai.  

Other kinds of property insurance policies may include:

• Apartment insurance - For those who own apartments in Dubai 

• Landlord insurance - This protects landlords from tenant-related damages and loss of rental income 

• Additional living expenses insurance - In cases wherein one’s home is temporarily uninhabitable due to an incident, and they have to bear the costs of living elsewhere. 

• Medical payments to someone else insurance - This is beneficial in covering the medical expenses of a person who was injured on a homeowner’s property. 

Benefits of home insurance

Property insurance in Dubai is always recommended for homeowners, as it not only safeguards them from risks but also holds several benefits. These benefits include:

• Protection of your property and belongings from natural disasters such as floods or sandstorms. 

• Coverage, which is needed to recover the costs of theft and vandalism to the property. 

• Personal liability protection is very convenient in cases of damage to the property or accidents that cause injury to the homeowner or a visitor. Personal liability protection can be helpful for things such as legal fees and medical bills in case someone is injured. 

• Home insurance in Dubai also provides coverage for fires and similar risks, such as water damage, explosions, and more. 

• Buying a property in Dubai is a substantial investment in itself, and damages to one’s property can utilize a large extent of one’s finances. Property insurance or any form of real estate insurance can considerably reduce those costs. 

• Some moneylenders in Dubai and the UAE require people to obtain home insurance before granting them a mortgage. Once again, it fortifies your investment. 

Documents required for property insurance in Dubai

One of the most significant steps towards obtaining home insurance in Dubai is to collate and submit the correct documentation. 

Be it house insurance or another form of property insurance, you will be required to provide several documents to the insurance provider - as they will help the provider assess the risks associated with your property. 

Some of the most common documents required for obtaining property documents include: 

• Personal documents 

  • A valid Emirates ID or passport 

  • Proof of ownership: title deed/sales agreement/Ejari registration 

• Property documents 

  • Architectural plans or drawings of the property 

  • A valuation report assessing the property’s value 

  • Photographs of the property which document its features and current condition

• List of contents, an inventory of sorts that defines the possessions you own and their estimated values 

• Proof of security measures, such as: 

  • Security systems

  • Fire safety equipment

  • Alarms 

• Additional documents that will help the provider better assess the risks related to your property 

Property insurance cost in Dubai

The cost of real estate insurance is a critical factor for homeowners to consider when searching for the right insurance policy. Generally, the cost of property insurance in Dubai depends on your insurance needs and the kind of coverage you opt for. While it usually spans from 0.1% to 0.5% of a property’s value per year, here is a more detailed breakdown:

For home contents and personal possessions insurance, the annual insurance premium is generally 0.5% of the total contents coverage value. For the proper quote, you should provide a rough estimate of the value of your possessions to the insurance provider. 

If you have bought a single-family home and are opting for building insurance, the annual for which will generally begin at 0.1% of the rebuild value of your home. The premium for building insurance generally accounts for factors such as the property age, its rebuild value, the perceived risks, and the history of its damage. 

Other factors that will influence the overall cost of your home insurance premium are: 

• The location and value of your property 

• Your personal claims history 

• The kind of coverage you select and its amount 

• The security systems you have set up in your property.  

To correctly evaluate the hidden costs of buying a property in Dubai, you can enlist the help of Engel and Völkers’ RERA-accredited real estate agents - who have both experience and expertise in the Dubai property market and will guide you through the costs your property may bring upon you in the future. 

How to choose the right home insurance?

Selecting the right home insurance policy in Dubai should not be taken lightly, as it has the potential to impact your finances at a later stage. 

While selecting property insurance, here are some factors you should take into consideration: 

• Your budget will be the most pivotal factor in this decision. You must learn how to compare home insurance policies in Dubai by visiting different insurance providers and seeing the quotes and coverage they provide for your property. 

• There are different types of coverage available in home insurance policies. Consider which covers you will most likely require and opt for those. 

• Select a policy that covers the full value of your home and its contents. 

How to apply for property insurance?

Applying for property insurance in Dubai is a relatively straightforward process. Here are the steps you can take while applying for it: 

1. Request a quote from different insurance providers. This will give them a chance to assess your property and provide their coverage options, which in turn will allow you to select the right option for your property. 

2. After selecting your insurance provider, complete the application form and submit the necessary documents. 

3. Pay the first premium to initiate your coverage. 

4. The final step of obtaining your home insurance in Dubai is the underwriting and approval process - for which your application will be evaluated by the company. Upon approval, you will receive your insurance policy documents.  

Common myths about home insurance

While buying real estate insurance in Dubai, there are many myths people initially fall for, which can lead to issues or shocks at the time of buying insurance. Here are some common myths about property insurance to avoid:

• Most insurance policies provide coverage for different forms of natural disasters, but not all natural disasters. Each insurance policy will specify what natural disasters it provides coverage for - be sure to look into those before applying for one. 

• Many homebuyers assume that the premium for a home insurance policy will be less if they buy an older apartment. On the contrary, older properties often require a higher premium due to factors such as old structural components and a higher insurance coverage fee required for those. 

• When it comes to contents insurance, bear in mind that it does not cover every single personal belonging of yours. Rather, it provides coverage for some of the most valuable items you may possess, such as jewelry, designer clothing, electricals and other such possessions. There are typically limits to contents insurance coverage, which differ depending on the insurance provider. 

Conclusion

Looking to understand further about home insurance in Dubai? Be it that or finding your dream property in the dynamic city, Engel & Völkers Dubai is here to guide you through each tangent of Dubai’s real estate market. 

Contact us at +971 4 422 3500 today for a consultation!