Saudi Arabia: Regulator reviews motor insurance pricing system
Source: Middle East Insurance Review | Nov 2026
The Insurance Authority is reviewing the motor insurance pricing mechanism to ensure that insurance companies comply with regulatory standards, and that they set fair and reasonable prices, according to a statement on its website.
The review is based on six criteria, namely:
- Insurance companies must ensure that product prices are fair and not exaggerated.
- Prices are in accordance with underwriting rules.
- Prices do not fall below a technically acceptable level or cause insurers to lose money.
- Prices must be supported by reliable data and experience.
- An insurer should not rely solely on the prices charged by other companies.
- Insurers are to provide the Insurance Authority with the bases used in determining prices.
Reviewing motor insurance pricing does not necessarily lead to a general reduction in policy prices. Rather, it may curb unsupported price increases as well as prevent insurers from lowering prices to levels that harm profitability in order to gain market share.
Moody’s Ratings said that the regulatory criteria for motor insurance pricing should strengthen underwriting discipline, reduce excessive price competition and support the long-term sustainability of the motor insurance segment, which is a significant branch in Saudi Arabia’s insurance market.
Profitability has remained under pressure, with the motor net combined ratio deteriorating to 107.3% in 2025 before improving to 102.5% in 1Q2026 as recent rate increases began to support underwriting performance. M