Co-Tenancy and Insuring Shared Property in the UAE

When you co-rent a place, you accumulate co-owned property like appliances, furniture, décor, and much more. Sometimes you feel the need to insure your belongings and there are many companies that offer such services in the UAE. Read more to find out about these companies.

• Why People Co-Rent Property
• Co-Renting a Property in the UAE
• Insuring Real Estate in the UAE

Why People Co-Rent Property

Rental prices for apartments have seen steady growth over the last 30 years. Real estate prices continue to grow and the number of young people who can afford to buy an apartment (let alone a house) has been declining. Co-tenancy has become a necessity.

Several tenants rent one apartment or a different type of property and share the expenditure linked with their household: the rent and utilities.

Co-Renting a Property in the UAE

Subletting or co-tenancy in Dubai is regulated by Article 24 of Law №26 and the overall Dubai Real Estate Law.

Co-tenancy in Dubai is forbidden unless you receive an official permit from your landlord. Without the property owner’s permission, you cannot let anyone move in with you or sublet a part of the residence unless your lease specifies that this is allowed. If the leaseholder violates the law, all tenants may be evicted from the premises, regardless of the agreed lease term.

Any relationships between a tenant and a subtenant are determined by a sublease contract. A second participant is entitled to the premises they rent as long as the original lease contract is in force. It should be noted that the number of leaseholders and sublease holders allowed to live in a property depends on the district.

Until recently, people of different sexes could not live together unless they were related by blood or marriage. The government has revisited this rule and these requirements no longer apply to any type of residential housing including hotel rooms, rented properties, and apartments.

Landlords, however, still seem to be unwilling to rent their property out to groups of people, especially if the property is located in areas designed for families.

Insuring Real Estate in the UAE

To insure your property or real estate in the UAE, you have two options: insuring the premises (protecting the residence from internal and external damage, for instance, from a fire) and insuring the belongings inside the premises (from damage or loss). It is important to note that insuring belongings inside the premises is voluntary in the UAE. Depending on each individual case, the insurance companies may combine the two types into one policy or sell you several insurance policies.

There are about 50 insurance companies in the UAE and each company offers different insurance options. Here are some of the reliable and well-known insurers on the market:

• AXA Insurance
• Adamjee Insurance
• MetLife-UAE
• Dubai National Insurance & Reinsurance (DNIR)
• Arabia Insurance
• Oman Insurance Company
• Orient Insurance
• Emirates Insurance
• Alliance Insurance.

When choosing an insurance company, you should check the reviews and client feedback in advance. You can also employ a broker who is familiar with all the ins and outs of insuring your property.

Online aggregators can help you to compare your options. The application process is quite simple: you complete the form, state your status (property owner or leaseholder), estimate the approximate value of the belongings, and leave contact information. The website will then produce a variety of options that match your requirements.

The most important thing to keep in mind is that the amount stated in the policy should cover 100% of the cost of the items permanently located within the household. This includes the furniture, appliances, high-end items, etc.

When signing your insurance contract, make sure you study the payment conditions and the paperwork you would need to provide in case of an insured event. You should also pay attention to the list of situations when the insurance will not be paid: for instance, some companies will not pay out if the residence was empty for over a month.

In a Nutshell

Although the UAE is considered a safe country, you should never discard the chance of natural disaster or violence. In case of a fire or a busted water pipe, a wisely picked policy can help you recoup your losses.

Don’t forget about civil liability insurance. If a fire or a flood damages other apartments, the neighbours may sue the responsible tenants.

Cover photo: freepik (Freepik)