MADINAH — The Saudi Arabian Monetary Authority (SAMA) has asked vehicle insurance companies to reduce the prices of their policies by 10 to 30 percent for individuals starting April, local daily Al-Madina reported on Wednesday.
The agency said this would be in addition to an optional 10 percent reduction to be given to loyal clients who insure their cars with the same company for several years.
SAMA said the discounts would be given only to customers who have clean records and have not made any accident claims from one year to three years.
It said the discount would be given to individuals, not companies, irrespective of whether they have third party or comprehensive insurance.
Mohammed Al-Issa, spokesman for an insurance company, said the individual insurer will have the right to the reduction in case he has not made any claims in one to three years.
He said as a token of loyalty, a company should make a discount of 10 percent in the value of the insurance policy to people who have been insuring with it for several years without making any claims.
Al-Issa said a reduction of 10-15 percent in the value of the insurance policy would be given to the insurers who have not reported any car accident for a whole year.
"The reduction will be between 15-25 percent to insures with no claims for two years and will be between 20-30 percent to those who have no accidents in three years," he said.
He, however, explained that the reduction of 10 percent to be given as a token of loyalty is optional and left to the discretion of the insurance company.
The spokesman expected the SAMA decision to curb the consistent increase in insurance premiums in the Kingdom.
