Market Trends of Saudi Arabia Motor Insurance Industry
This section covers the major market trends shaping the Saudi Arabia Motor Insurance Market according to our research experts:
Growing Demand for Passenger Cars is Surging the Growth of the Market
Saudi Arabia's motor vehicle sales of passenger cars were reported at thousands of units in June 2021, recording a decrease from the previous number of thousand units for December 2020. Saudi Arabia's motor vehicle sales recorded fewer units in December 2020 than the previous year's units.
Saudi Arabia's motor vehicle sales are updated yearly, available from 2005 to 2020. The center estimated that Saudi Arabia would acquire some percent of car sales in the Gulf Cooperation Council countries by 2025, out of a total market of million cars, including electric vehicles.
Insurance Density has Potential to Increase
Insurance density can increase in the coming year due to a recovery in the economy and an increase in GDP (Gross Domestic Product) per capita income. The insurance industry is expected to grow in the coming years. Government initiatives are likely to boost the insurance industry by implementing new regulations and economic policies aimed at boosting consumer spending.
The demand for insurance in Saudi Arabia is still primarily driven by government legislation and the consumer penetration strategies of major insurance players. Recently, the digital platforms through which products and services are provided have been on the rise.
A higher number of motor insurance policies are sold online. However, so far, this agility has been witnessed more among the larger insurance players. Digital platforms, when adequately designed and when taking into account the target market's needs, are certainly beneficial; they allow insurers to easily access large pools of new customers whose demands and needs are aligned with the relevant product offer. They can also lower the costs of distribution.
