The Association of Insurance Companies of the United Arab Emirates explained the increase in insurance tariffs for electric vehicles, including Tesla cars, due to the absence of official dealers in the country, as well as the temporary high cost of spare parts and their inaccessibility.
It was reminded about the narrow connection of electric vehicles, including Tesla, with batteries, by Mohammed Muzaher Hamada, vice president of the Higher Technical Committee and chairman of the Committee on Automotive Insurance in the Association of Insurance Companies of the United Arab Emirates, who pointed out the high risks of loss both at the regional and global levels.
Hamada's comments followed complaints by users about the increased cost of insuring electric vehicles, especially Tesla cars, where the cost of the policy, according to their statements, increased from 2023 to 2025 and reached a mark between 4.5% and 6% of the cost of the car compared to the current year.
Hamada emphasized that high costs and the absence of official dealers represent a high level of risk for insurance companies, while those operating in the market represent the usual car manufacturers or just dealers for car sales.
A representative of the Association of Insurance Companies of the United Arab Emirates confirmed that the maximum rate for insuring electric vehicles constitutes 5% of the cost of the vehicle, and no company has the right to reassess insurance tariffs above this figure, therefore 6% is an unacceptable figure.
It should be noted that for electric vehicles, it constituted 14.75% of the total volume of car sales in the country in 2024, with forecasts for increasing this share to 22.32% by 2029.
The UAE encourages the transition to electric vehicles and suggests significant improvements for their charging with an expected increase in the number of charging stations across the country to 500 by the end of the current year. Besides, according to the latest official statistical data as of May 2024, the number of electric vehicles in the country exceeds 40 thousand cars.
