Jordan: Central Bank of Jordan rejects motor premium increase
Source: Middle East Insurance Review | Feb 2025
The Central Bank of Jordan (CBJ) has rejected the demand to raise the motor third party liability (MTPL) rates. The country’s insurance industry had submitted a proposal in this regard to CBJ in December 2024.
The CBJ has, however, issued a set of fundamental amendments to the MTPL regulations, following a thorough analysis of the financial challenges facing insurers writing this line of business.
Insurers in Jordan have often voiced deep concerns regarding the MTPL losses and their impact on the companies’ profitability and the sector. The CBJ, however, announced a set of procedures to help balance the financial stability of insurers, avoid to burden citizens but at the same time to ensure a fair claims settlement for motorists.
The new instructions, which came into effect from 1 January 2025, include improving and simplifying the procedures for settling claims and compensating those affected by accidents, so that compensation for amounts not exceeding JOD3,000 ($4,230) is paid within five working days, while values exceeding that are paid within 10 working days, once the claim is approved.
Companies failing to adhere to these deadlines will face fines of up to JOD10,000 with penalties doubled in case violations are repeated. M