Saudi Arabia – Activating compulsory motor to boost the sector
Saturday, 05 28 2016, Category: Insurance and Reinsurance, Country: Saudi Arabia
The head of the insurance awareness and training committee at the Saudi Arabian Monetary Agency and insurance companies’ media spokesperson Mr. Adel Al-Issa requested the activation of compulsory motor insurance coverage on all vehicles. He expected this move to have a large impact on the results and profits of insurance companies especially given that the motor branch is the main driver of losses at most insurance companies due to a high frequency of accidents and the very high cost of spare parts.
Mr. Al-Issa added to “Aleqtisadiah” that the high start-up costs caused some insurance companies to go out of business although they only received a license one or two years ago. As a result these insurers lost a part of their capital and suffered in turn from losses.