Ajman One tenants furious at Dh10,000 fire compensation cheques

Residents of the blaze-hit towers hit out at developer over paltry amount after being told all losses would be covered but their plight serves as reminder of importance of household contents insurance.

AJMAN // Tenants who lost everything in the Ajman One fire in March and were told their losses would be covered are furious at Dh10,000 cheques being handed out as compensation.

Many of the tenants of towers six and eight were moved into adjacent buildings, sometimes at lower rents than before, but they still lost all their possessions and were told by the building developer in early April that their losses would be covered by insurance.

But Ghaleb Jaber, general manager of the developer, Real Estate Investments Public Corporation, said that Union Insurance Company had refused to pay out, which meant that the corporation was now handing out cheques of between Dh8,000 and Dh10,000 as compensation.

“The insurance company refused to pay out because tenants should insure their furniture, not the corporation. We, as a corporation, insure the towers against disaster, not the tenants’ furniture. We found some tenants insured their furniture but most of them did not,” Mr Jaber said.

The fire was a warning to residents to get contents insurance but Mohammed Al Shamali, a Palestinian who moved to his apartment in tower six just hours before the fire and only two days after his wedding, said he had refused the compensation cheque.

“The cheque is Dh8,000. My wife’s wedding dress alone was Dh8,000, and my total losses were about Dh35,000,” said the 26-year-old. “I told them that it was not useful and they said, ‘that is what we have and it is a help’. I told them I do not need help, I only want my right.”

Mr Al Shamali has hired a lawyer to act on his behalf. “The lawyer told me that I will absolutely win but it will take time. I told him it does not matter, as long as I get what’s due to me.”

Athar Abbas, 44, a Pakistani bank employee, was shocked when he received the compensation cheque because it was not what he had been told.

“That was not what they [the developer] promised us. They said that they would compensate us for everything we lost,” he said. “The new furniture I bought cost me more than Dh50,000 and the damaged furniture was in the same range.”

Depending on the size of flat, each tenant has been offered between Dh8,000 and Dh10,000. The developer said that flat owners would be compensated by the insurer after two months.

“We compensated the tenants because the insurance company refused to compensate them for the damaged furniture, so the corporation gave each apartment a cheque of Dh10,000 for bed, refrigerator and washing machine, and we counted Dh1,000 for each item,” Mr Jaber said.

“After two months, we will hand over the flats to their owners and will count how many months rent they lost during the maintenance period and then the insurance company will compensate them.”

But landlords are unhappy at the slow progress of payouts.

An Indian owner of six flats in the burnt-out towers said he faced a financial crisis.

“I have to pay tenants deposits that I have to return. I am in a lot of dificulty because I borrowed money and asked for money from India. I just want to have some of the lost rent back so I can repay tenants.”

Mr Jaber said tenants in towers eight and six would remain in their new apartments because the corporation cancelled their rent contracts after the fire and gave them new homes, often at lower prices, elsewhere in the complex.

The March 28 fire destroyed dozens of apartments in the 26-storey towers eight and six.

Union Insurance Company declined to respond, instead directing The National to the developer.