Takaful News - Saudi Arabia: Number of motor accidents triples over 4 years
Source: Middle East Insurance Review | May 2016
The number of motor accidents in Saudi Arabia is forecast to exceed 1.1 million this year, or 125 accidents an hour, said Mr Adel Abdulaziz Al-Essa, the spokesman for Executive Committee for Insurance Companies, which called on the authorities to take urgent action to improve road safety.
Citing statistics from Riyadh-based Najm Insurance Services, which works with insurance companies to offer motor-related services such as removing vehicles from roads and providing damage assessment, Mr Al-Essa said the number of road accidents in the Kingdom increased from 306,000 in 2011 to more than 962,000 last year.
He said motor claims amounted to more than SAR25 billion (US$6.7 billion) in the last five years, of which the total paid over the last three years alone exceeded SAR20 billion. The combined loss ratio exceeded 100%.
The rising number of motor accidents is bad news for insurers which are already hit by high prices of spare parts, an increase in blood money payouts from SAR100,000 to SAR300,000, growing number of fraud cases, and payments made to third parties whatever the cause of the accident, including running a red light or driving under the influence of intoxicants or drugs.
Mr Al-Essa said that the figures do not reflect the actual costs of road accidents because the proportion of cars insured in Saudi Arabia is less than 45% of the total number of cars plying the roads. Although third-party auto insurance is compulsory in the Kingdom, enforcement is weak against those who fail to buy such insurance.
Saudi Arabia ranks second among Arab countries and 23rd globally in terms of deaths due to road accidents, according to a World Health Organization (WHO) report released last year. Seventeen people are killed in crashes every day on average in the Kingdom.
SAR1 = US$0.27