Jordan: Insurers push again for motor pricing liberalisation
Source: Middle East Insurance Review | May 2019
Mr Majed Smairat, chairman of the Jordan Insurance Federation (JIF), has said that compulsory motor third party liability (CMTPL) insurance poses the biggest challenge to the insurance industry, as insurers continue to suffer huge losses in this branch.
CMTPL insurance business incurred losses of over JOD250m ($352.6m) between 2000 and 2018.
In an interview with the Jordanian news agency Petra, Mr Smairat called on the government to allow insurers to freely set their own premium rates for CMTPL insurance and to allow competition between insurers to provide the best services to their customers.
He urged the government to abandon its practice of setting tariff rates for this class of business.
He cited difficulties caused by increases in costs of spare parts and repairs, medical treatment costs, wages, legal fees and administrative costs, in addition to losses due to fake accidents.
The call for CMTPL tariff liberalisation is the latest by JIF which has long pushed for pricing reform.
Other challenges faced by the insurance sector include the absence of a specialised insurance law, the absence of competent courts to consider insurance cases, in addition to fees imposed on the insurance sector.
He called for more civil and professional liability insurance, such as medical liability insurance, the introduction of new insurance programmes, the targeting of other customer groups, and microinsurance. M
JOD1 = $1.41