Despite a spate of high-profile fires in Qatar and the region, many residents here neglect to insure their household belongings – which could cause significant financial hardships if an incident occurs, a local expert has said.
This weekend’s massive fire in a Dubai skyscraper has once again highlighted the problem, raising a discussion about the low rates of home insurance among tenants in the region, and the economically devastating consequences.
On Saturday, a fire on several floors of the 79-story Torch Tower in Dubai prompted a mass evacuation of residents. While there were no reports of deaths or serious injuries, several people said they lost all their belongings in the dramatic blaze.
Here in Qatar, government statistics show there are approximately 1,000 fires annually.
The cause is unknown in the vast majority of cases, but the Ministry of Interior has repeatedly warned residents to take steps to protect themselves from the electrical shortages that most commonly lead to home fires.
Several industry experts say that while it is easy to convince prospective customers to insure their personal belongs, the overall level of awareness is low.
“Many people are not aware that this should be an essential policy for them,” said Elie Saade, a Qatar-based account manager at AXA, which provides insurance services.
Without it, “No one will cover your contents, your belongings,” he noted.
He said there is limited awareness of the importance of tenant’s insurance in Qatar. Most of the demand for the service from his firm is concentrated in the Pearl-Qatar and West Bay areas.
Why not insured
Saade said it is difficult to know why relatively few people insure their personal belongings here. He conceded that his industry could advertise the service more, as some expats come from countries where home insurance is uncommon.
He also noted that rising rents in Qatar mean that many residents many not have much money left over at the end of the month.
Still, Saade estimated that QR50,000 worth of coverage would only cost between QR500 and QR700 annually in premiums, depending on the nature of the contents in one’s home.
Others in the industry speculate that the transient nature of expat life plays a role in not getting insured.
According to a government household survey, the majority of Qatar’s expats – nearly two-thirds – live in rented accommodation.
“A lot (of expats feel) they’re not here for long, or they buy furniture from Ikea, so they don’t think about how important insurance is, or the risk of theft is low. They think, why spend money on home insurance when they could spend it on something else,” Zahir Sharif, UAE manager of insurer Zurich, told The National.
His firm commissioned a survey in 2013 that found only 6 percent of UAE residents took out home insurance, compared to 75 percent in the UK.
No comparable figures for Qatar were immediately available.
Anecdotally, however, some in the industry said the policies may be more popular here than in the UAE, as it is easy to demonstrate the value of insuring personal possessions such as computers and clothes to potential customers.
“It’s not difficult to convince people to protect the contents of their home,” said Abdul Samad, who works with Qatar-based Damaan Islamic Insurance Co. He told Doha News that he sells about 40 policies each month.
Why it’s needed
Sapish Gurrala, an assistant manager at Qatar General Insurance and Re-Insurance Co., said they had a considerable number of clients who buy housing insurance every month, but he didn’t have exact statistics.
Gurrala said that housing insurance is very important for tenants, even in the case of small accidents.
He explained that if a tenant accidentally broke a glass window in a rented residence, the insurance company can cover it for him. The same thing applies for all the contents of the house, including the tenants’ belongings in the case of a fire or a plumbing problem.
He expressed sorrow for the residents of Dubai who lost their homes and belongings in the fire.
“They suffer (from) great loss,” he said.
He said that “alternative housing insurance,” that provides accommodation for tenants who lost their “rented apartments” in accidents could help a great deal in cases of fires, like the one that took place in Dubai.
He added that his clients haven’t been subjected to many fires or big accidents.
“The number of fires is very limited,” he said.
Do you have home insurance? Thoughts?