Saudi Arabia – Legality of linking motor insurance to cost of accident studied
Monday, 06 27 2016, Category: Insurance and Reinsurance, Country: Saudi Arabia
The Saudi Arabian Monetary Agency is studying the legality and lawfulness of linking motor insurance prices to the past accidents of the vehicle driver and the related costs using a unified database. This move follows the plans of companies operating in the local market to study the records of citizens and residents through a system, which reveals the number of accidents annually and their related costs.
Moreover, some experts warned about a negative implementation of such as system by increasing prices as long as it will be authorized by SAMA bearing in mind that motor insurance prices increased within 5 years between 200-300%. They also indicated that the price increase on the insurance policy for people with no accident records should not exceed 3.5% of the value of the insured vehicle.
Source: Al Madina Newspaper