Report Overview

An increasing focus on insuring against the loss during the untoward incidents, motor insurance companies’ rapid adoption of insurtech and innovative tracking & digital technologies, and growing automobile sales driven by an increasing need for personal mobility solutions across the kingdom could boost the growth of Saudi Arabia motor insurance market during the forecast period between 2023 and 2029.

Saudi Arabia Motor Insurance Market – Industry Trends & Forecast Report, 2029

Saudi Arabia motor insurance market size was estimated at USD 7.95 billion in 2022. During the forecast period between 2023 and 2029, Saudi Arabia motor insurance market size is projected to grow at a CAGR of 4.07% reaching a value of USD 10.45 billion by 2029. In today's world, the number of crashes, traffic mishaps, and accidents is always increasing. All of these factors contribute to the determination of automobile insurance premiums. People in large urban areas, for example, are willing to pay a high premium due to their substantial discretionary income. Texting, talking, or doing other activities while driving is a problem in every city and can be a major cause of accidents. Auto insurance pays for an injured person's medical treatment, lost wages, vehicle repair, and any property damage caused by an accident. Therefore, customers are purchasing auto insurance to mitigate financial losses, which is driving up demand during the forecast period.

Saudi Arabia Motor Insurance Market - Overview

Cars, trucks, automobiles, motorbikes, and other vehicles are all covered by motor insurance. Motor insurance is popular among consumers because it provides financial protection in the event of vehicle damage as well as harm to other drivers, passengers, or pedestrians (i.e., third-party cover). Therefore, adequate auto insurance is both a legal need and a necessity.

Growth Drivers

Development of Third-Party Liability Insurance

Because of people's ignorance, collisions, accidents, and other dangers or injuries to third parties occurred. The basic insurance policy has nothing to do with car damage, but third-party liability insurance compensates the owner of the car for any property damage caused to third parties who are not covered by the policy. This policy protects you from financial loss if third-party property damage, disability, injuries, or death occurs to walkers, drivers, or passengers in other vehicles. Nonetheless, this type of planning helps to protect the interests of third parties. All of these factors are projected to boost the motor insurance sector significantly during the forecast period.

Restraints

Rising Cyberattacks and Associated Threats

Insurance firms are always dealing with numerous cases of fraud and are not always as successful as they would want. As other industries, such as banking, become safer, hackers' emphasis shifts to more vulnerable target organizations. Insurers retain a massive database of Personality Identifiable Information (PII) about policyholders, including names, birthdates, social security numbers, street and email addresses, health data, and work data, such as income. Personal information on policyholders' personal property, such as homes and cars, might potentially be a target.

Impact of COVID-19 on Saudi Arabia Motor Insurance Market

COVID-19 pandemic significantly impacted the Saudi Arabia motor insurance market, as the countrywide lockdown that caused businesses to close. As a large portion of premiums goes towards the purchase of new cars, the shutdown and accompanying near-halt in activity may exacerbate the situation. One of the most serious difficulties confronting the industry was a lack of new automobile purchases. To compensate, the coverage net of existing vehicles was typically expanded, as the vast majority of them were no longer insured by the third and fourth years.

Saudi Arabia Motor Insurance Market

Segmental Coverage

Saudi Arabia Motor Insurance Market - By Type

On the basis of type, Saudi Arabia motor insurance market is divided into Liability Coverage and Comprehensive segments. The liability coverage segment is a higher contributor to the growth of Saudi Arabia motor insurance market. The primary benefits of this coverage type are that it compensates for any third-party damage, such as disability, death, or property loss. Third-party liability insurance protects you legally and financially. A major factor for the rising desire for third-party liability coverage insurance is the potential for automobile accidents and third-party damage.

Saudi Arabia Motor Insurance Market - By Distribution Channel

On basis of distribution channel, Saudi Arabia motor insurance market is divided into Agents, Brokers, Banks, and Online segments. During the forecast period, the agents segment is expected to record the fastest growth in the Saudi Arabia motor insurance market. This is due to the ease of purchasing insurance policies, insurance agents guide discounts, offers, and plans, bolstering consumer confidence in purchasing motor insurance.

Competitive Landscape

Major players in the Saudi Arabia motor insurance market include Bupa Arabia for Cooperative Insurance, Tawuniya Insurance, Allianz Saudi Fransi Cooperative Insurance Co., Malath Cooperative Insurance & Reinsurance Co., MetLife AIG ANB Cooperative Insurance Company, Gulf General Cooperative Insurance Company, Saudi Arabian Cooperative Insurance Company (SAICO), Aljazira Takaful Taawuni Company, Wataniya Insurance Company, MedGulf Allianz Takaful, Al Rajhi Takaful, AXA Cooperative Insurance Company, Arabian Shield Cooperative Insurance Company, Chubb Arabia Cooperative Insurance Company, and Arabian Gulf Cooperative Insurance Company. The key strategies used by these market leaders are new product launches, mergers & acquisitions, and alliances. To grow their market share, these companies are also focusing on investing in innovations, collaborations, and expansions.

Recent Developments

• In January 2023 – The Saudi Arabian Monetary Authority (SAMA), or the Saudi Central Bank, amended the Unified Compulsory Motor Insurance Policy including updating the exceptions and transferring of rights in recovery cases.

Scope of the Report

By Type

• Third-Party Liability

• Comprehensive

By Distribution Channel

• Agents

• Brokers

• Banks

• Online

• Others