Also insurance policies for boats, motorcycles and other vehicles.
Drinking alcohol + driving + accident or crash = no insurance in the UAE. This also applies to the 200,000 dhs blood money you have to pay if someone dies as a result of your actions.
There are many automobile insurance companies in the UAE but ask around for personal opinions - like anywhere in the world, there is a huge variety of levels of customer service and satisfaction. Ask friends and colleagues for opinions on claims made. Most, if not all, insurance companies are much more helpful when they want your money than when you need your car repaired.
Some particular car makes or models can be difficult to insure if they have a reputation or history of being involved in a disproportionately high number of vehicle accidents. Check with your insurance company before buying a car if they will insure it. Nissan Maximas were one example of this rumour or policy. If buying a Nissan Sunny you're probably safe to assume it can be insured.
Sports, fast, or luxury cars are expensive to get insured.
Drivers under 25, especially males, will find insurance difficult and/or more expensive.
Cars older than 5 (or 7 depending on the company) years are likely to be difficult to get comprehensive insurance for. Check before buying one.
Some policies do not insure cars when driven off-road. This could include parking your vehicle on the sand behind the building. This might also just be urban legend but potential for disagreement with your insurance company is there. Even if an insurance policy insures vehicles for off-road driving, don't expect it to apply if you damage your 2wd Toyota Echo while dune-bashing in the Liwa sand dunes.
A car cannot be registered until it's insured. A car can be insured without being registered - check policy carefully but it would be unusual that an unregistered car is not covered unless there is something preventing registration eg worn or old tyres (tires).
There are 3 or 4 motor vehicle insurance types:
TP (Third Party) only - you are not covered for any damage to your vehicle unless there is another party at fault, and they are insured, and a claim can be made against them. Fire and theft is excluded. Even if your car is stolen and the thief is found, and he (or she but female car thieves seem to be extremely rare in the UAE) has an insurance policy, it is unlikely that his insurance company will reimburse you for your stolen car.
TPFT (Third Party, Fire & Theft) which is the legal minimum you are required to have, and is the cheapest [check - might not be legal minimum - some insurance companies only offering TP without fire and theft]. In an accident, your insurance company will not pay for damage to your own car - someone else's might if they're to blame.
Comprehensive or Fully Comprehensive (basic level) - there is a legal obligation for insurance companies to provide this at a certain maximum price level of about 3-5% of the value of the car. It covers damage to your own car but expect lots of restrictions and loopholes or get-out clauses.
Comprehensive with options - for extra cost you get options like dealer repair, free hire car, free insurance in Oman and other GCC countries, recognition of no claims bonuses (either UAE and/or from overseas). Expect to pay 3-10% of the value of the car depending on company and no claims bonus.
Comprehensive, premium level - for even more money you get options similar to previous level. Usually there are some restrictions on who can buy this level of insurance. Expect to pay an extra 1 or 2% of the value of the car.
If you're coming from overseas, bring an original no claims bonus certificate with you (if you have one). Usually it's worth 0-40% discount on the normal rates. No claims bonuses rarely exceed 40% discount in the UAE.
Try negotiating with the insurance company - if you have some wasta, their rates may be flexible.
Insurance brokers will sometimes find a cheaper deal. A downside is if they are disorganised and you rely on the broker to send you policy renewals and deal with accident claims - not that insurance companies are necessarily always organised but it's one less step in the chain of bureaucracy if you deal direct with the company. HSBC bank has a brokerage service which seems to be a reasonably good choice.
Three of the best companies worth trying in our experience are (also for boats, yachts and motorcycles):
Al Ittihad Al Watani General Insurance Company, Al Garhood Center, Deira, tel +971-4-2823266. Websites are unhelpful - www.unic.ae and www.alittihadalwatani.com.lb each tell you to visit the other one.
AXA Insurance (was previously called Norwich Union) - tel +971-4-3243434, in the Wafi Residence Ground Floor. But they are fussy about the age of the car for comprehensive insurance - even for long term customers with a good record they don't care about loyalty and will cancel the comprehensive part of your insurance for older cars. That aside, we still think they're one of the best and most helpful companies for newer cars.
RSA Group (rebranded from Royal & Sun Alliance) - toll-free in UAE 800-RSA (800-772) (also tel +971-4-3029991) (+971-4-3348820 or +971-4-3344474 no longer valid).
Car insurance driving UAE to Oman - and the Orange Card
From 01 October 2011, UAE car owners will be required to obtain an "Orange Card" from their insurance provider to show at the border crossing when driving between the UAE and Oman (Gulf News report 17 August 2011).
The Orange Card system is that each member country has a Unified Insurance Bureau which deals with insurance claims arising in another country. The system comes from the 1975 Arab Insurance Card Convention which member countries sign up to.
The Unified Insurance Bureau in the UAE is the Abu Dhabi National Insurance Company (ADNIC).