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UAE Car Insurance Market Overview
Market Size in 2025: USD 4.24 Million
Market Size in 2034: USD 15.45 Million
Market Growth Rate 2026-2034: 15.46%
According to IMARC Group's latest research publication, "UAE Car Insurance Market: Industry Trends, Share, Size, Growth, Opportunity and Forecast 2026-2034", The UAE car insurance market size was valued at USD 4.24 Million in 2025 and is projected to reach USD 15.45 Million by 2034, growing at a compound annual growth rate of 15.46% from 2026-2034.
How AI is Reshaping the Future of UAE Car Insurance Market
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UAE Car Insurance Market Trends & Drivers:
Mandatory car insurance rules in the UAE are the basis of the car insurance industry. Third-party liability cover is mandatory on all vehicles. In the UAE, the minimum legal car insurance coverage is for AED 2 million for damages and AED 5 million for injuries. If caught driving without insurance, the penalty is AED 500 with four black points, a towing and impounding of the vehicle for a minimum of seven days to a maximum of 15 days (UAE Insurance Authority Circular No. By 06/2025, regulations had been introduced for the usage-based insurance products, and in July 2025 the flood insurance product became mandatory. Because around 200000 cars are sold per year, the purchase of a new vehicle requires the purchase of new car insurance for the new vehicle.
Telematics (or usage-based insurance) is expected to transform how residents in the UAE pay for car insurance premiums with 5G Phase-2 by Etisalat and Du, through drivers being tracked by insurers with metrics that include accelerometer spikes (which indicate how hard the driver has braked), GPS (which logs average speed) and photos taken of them using mobile phones while driving. Numerous cashback policies exist, including "Beema SmartDriver", launched by Beema Insurance in January 2022. Global professional services firm PwC Middle East claims behavior based insurance products appeal to cost driven drivers. Usage-based pricing or telematics-rich insurance models provide the best outcomes for low-risk drivers. Regulatory approval by the UAE's Insurance Authority and the presence of over 30% of MENA fintech startups give rise to greater telematics integration and the associated benefits in this region.
With 24000 electric vehicles and hybrids sold in 2024, a specialist EV insurance market developed. EV insurance premiums in the UAE average around AED 4992 (US$1293) annually. Due to the battery manufacturing and electric motor, the premium is 20% to 35% higher than ICE counterparts. Average insurance on ICEs is AED 2895 (US$788). The battery and motor contribute to 40% of the cost, which ranges from AED 60,000 to AED 80,000. In October 2024, Abu Dhabi National Insurance Company launched EV insurance that covers battery deterioration and availability to charge. According to the Central Bank of UAE, auto insurers should provide a discount of up to 25% on qualifying EVs. As the EV repair market matured, some insurers reported premiums for claim-free EVs leveled off or decreased from 2025 as premiums remained steady.
UAE Car Insurance Industry Segmentation:
The report has segmented the market into the following categories:
Coverage Insights:
Application Insights:
Distribution Channel Insights:
Regional Insights:
Competitive Landscape:
The competitive landscape of the industry has also been examined along with the profiles of the key players.
Recent News and Developments in UAE Car Insurance Market
Note: If you require specific details, data, or insights that are not currently included in the scope of this report, we are happy to accommodate your request. As part of our customization service, we will gather and provide the additional information you need, tailored to your specific requirements. Please let us know your exact needs, and we will ensure the report is updated accordingly to meet your expectations.
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IMARC Group is a global management consulting firm that helps the world's most ambitious changemakers to create a lasting impact. The company provide a comprehensive suite of market entry and expansion services. IMARC offerings include thorough market assessment, feasibility studies, company incorporation assistance, factory setup support, regulatory approvals and licensing navigation, branding, marketing and sales strategies, competitive landscape and benchmarking analyses, pricing and cost research, and procurement research.
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