The UAE Central Bank has issued a notice to all banks and finance companies to allow a six-month repayment deferment for personal and car loans for customers affected by the recent storms in the Emirates.
The “deferral shall be without imposing additional fees, interest or profit” charges, or otherwise increase the principal amount of the loan", the regulator said on Monday.
The Central Bank also confirmed that damage to vehicles and homes due to the record-breaking storms last week would be covered if there is a comprehensive insurance policy against loss and damage.
“The insurance companies shall be considered responsible for indemnification,” the Central Bank said in a statement.
Watch: UAE lashed by heavy rain, thunder and lightning
“Owners of real estate, whether homes or buildings, covered by insurance are entitled to have their property repaired from damages caused by the recent rain and weather conditions.”
The Central Bank advised the public to read their policies carefully to protect their rights. It also suggested they approach Sanadak, the financial and insurance ombudsman, if they have a complaint or dispute with the insurance company.
Sanadak's services were launched last month with the aim of alleviating the legal burden on consumers by eliminating the necessity of claims being brought to the courts.
The regulator's latest measures come as the UAE experienced its record single day of rainfall last Tuesday since data recording began in 1949.
Homes and roads were flooded, while there were partly submerged cars were abandoned on motorways and flights were cancelled, delayed and diverted.
The National Centre of Meteorology data, which covered a 24-hour period until 9pm on Tuesday, showed 254mm of rain fell in one area of Al Ain – the equivalent of about two years' worth of average rainfall in the UAE.
The NCM said the persistent downpours were an “exceptional event in the UAE's climate history since the start of recording climate data”.
During the coronavirus pandemic, the UAE Central Bank also extended support measures aimed at helping lenders mitigate the effects of the pandemic and stimulate the country's economy.
The Central Bank launched the Targeted Economic Support Scheme in March 2020 to protect the UAE’s financial system and support the robustness of the economy. It also allowed bank customers to apply for loan payment holidays to ease their financial difficulties during the pandemic.
The scheme included Dh50 billion ($13.6 billion) from Central Bank funds through collateralised loans at zero cost to banks operating in the UAE and Dh50 billion in funds freed up from banks’ capital buffers.
