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Source of Zen Tower Dubai blaze found: Fire insurance market on fire

Last week we reported on the fire that engulfed Zen Tower in Dubai Marina, on May 13.

Update 22/06:

The fire that erupted began on the balcony of a first-floor apartment, where furniture was kept outdoors. It caught fire due to an electric short circuit, according to a report by Al Barsha police station released to local media.

The electric short-circuit was either in the lighting or the electric heater that was also kept on the balcony, experts noted.

“The furniture caught fire due to a flammable source that was enough to start the blaze. The source was either a short circuit in the lights or the electric heater. It could have been from smoking waste landing on the furniture, causing thermal glow with smoke, and that quickly turned into a blaze due to strong winds,” said the report.

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Comparison website, yallacompare, has seen a “100% increase in the number of home insurance policies being sold since the Zen Tower fire in Dubai Marina on Sunday,” CFO, Jonathan Rawling said.

Rawling said it is common to see a surge in residents buying insurance following a fire incident.

“That’s usually the way that things play out after a fire is reported. People see the news coverage, and for some, that’s enough of a push towards getting their belongings covered,” he said.

Nexus Insurance Brokers have also seen a surge in homeowners purchasing home and contents protection, although they assume it to be short-lived, following the similar trend as past occurrences.

“We are definitely busier than usual with inquiries for home insurance since news of the fire, and this is a pattern we have observed after similar incidents in the past,” said John Waldron, head of private clients at the firm.

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A 4-week spike

“When a fire happens, you do see that immediate response, and there is a brief surge in new business inquiries. After the fire in the Torch Tower last year, we saw a massive spike in inquiries coming into the market for maybe a three-to-four week period, but then the interest essentially reverts to typical volumes,” he added.

Waldron pointed out that the number of home insured people in the UAE remain remarkably low by international standards.

Yallacompare’s Rawling also displayed concern for low home insurance rates in the UAE, stating that only 11% of UAE residents are signed onto a home insurance policy compared to around 70% penetration rates in Europe, according to research by the website.