Motor Insurance Market in Saudi Arabia: Regulatory Reforms, InsurTech Innovation & Premium Growth

According to IMARC Group's latest research publication, Saudi Arabia motor insurance market size was valued at USD 4,192.6 Million in 2024. The market is projected to reach USD 9,280.3 Million by 2033, exhibiting a growth rate (CAGR) of 9.28% from 2025-2033.

How AI is Reshaping the Future of Saudi Arabia Motor Insurance Market

• Behavior-Based Premium Pricing with Telematics: AI analyzes real-time driving data from telematics devices tracking speed, braking, and mileage, enabling usage-based insurance that rewards safe drivers with up to 30% lower premiums.
• Instant Claims Processing and Fraud Detection: Computer vision AI examines accident photos and damage videos, processing claims 40% faster while machine learning algorithms identify fraudulent patterns, reducing false claim payouts significantly.
• Hyper-Personalized Risk Assessment: AI moves beyond demographics like age and ZIP code, analyzing vehicle specifications, weather patterns, traffic data, and individual driving history to calculate precise risk profiles in seconds.
• Predictive Maintenance and Safety Alerts: Connected vehicle data combined with AI predicts mechanical failures before they occur, sending alerts to drivers about tire pressure, brake wear, or engine issues, preventing accidents and claims.

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How Vision 2030 is Revolutionizing Saudi Arabia Motor Insurance Industry

Vision 2030's Financial Sector Development Program is transforming motor insurance through digital-first initiatives and regulatory modernization. The Insurance Authority automated vehicle insurance services and traffic accident follow-ups in December 2024, streamlining beneficiary experiences and advancing digital transformation goals. Motor insurance revenues surged 22.7% driven by new vehicle registrations while sector assets rose 20% to SAR 84.91 billion. The program aims to increase insurance sector GDP contribution to 8.2% by 2030 and boost private sector credit to 200% of GDP. Open banking frameworks launched in 2024 enable fintech integration with insurers, creating innovative digital payment solutions. The reinsurance sector thrives under new mandates requiring 30% business ceding to local reinsurers by 2025—Saudi Reinsurance Company reported 77% revenue increase in nine months. These initiatives reduce oil dependency while positioning Saudi Arabia as a regional financial hub through transparency, technology adoption, and infrastructure investment.

Saudi Arabia Motor Insurance Market Trends & Drivers:

Mandatory insurance regulations drive market expansion as the government enforces third-party liability coverage for all vehicle owners, ensuring compliance and widespread adoption. Najm introduced the Repair Network Service in July 2024—the first of its kind in Saudi insurance—securing collision-damaged cars for third-party clients. Facilities approved by the Saudi Standards, Metrology, and Quality Organization repair vehicles, guaranteeing safety and reducing financial burdens on accident victims. This initiative enhances road safety while providing quick, high-quality repair services meeting stringent standards. Regular law updates and strict enforcement foster accountability and financial protection among vehicle owners. In August 2024, authorities expanded coverage through mandatory medical insurance regulations and handling uninsured automobiles, with Islamic insurance revenues projected to surpass USD 20 billion in 2024, growing 15-20% the following year within the Gulf Cooperation Council.

Telematics and usage-based insurance adoption transforms premium calculations and customer experiences, making insurance products more accessible and appealing. In July 2024, Najm launched a telematics project with AiGeNiX and Cambridge Mobile Telematics to enhance road safety throughout the Kingdom. The initiative uses the AI-powered DriveWell Fusion platform to gather and analyze driving data, aiming to reduce accident rates aligned with Vision 2030 goals. The global telematics insurance market could grow over 25% annually through 2025 according to McKinsey, driven by personalized services and regulatory support for safer roads. Insurers now assess individual risk through real-time driving behavior rather than demographics, benefiting low-mileage drivers, seniors, and careful drivers. Digital platforms optimize claims processing while cloud-based telematics systems offer unmatched scalability, integrating seamlessly with AI engines and real-time visualization dashboards.

Government initiatives and infrastructural investments under Vision 2030 fuel market growth through economic diversification and technological advancement. In October 2024, Najm initiated the third "Insure and Be Safe" campaign under Insurance Authority supervision—a nationwide effort to increase road safety, improve quality of life, raise insurance awareness, and achieve Vision 2030 goals. The Financial Sector Development Program targets increasing insurance penetration, creating opportunities for health, property, and business insurance solutions. Mega-projects like NEOM drive vehicle ownership and transport activities, boosting demand for comprehensive policies. The sector implemented IFRS 17 and IFRS 9 standards, bringing transparency to financial performance—evidenced by Q3 2024's 93.69% combined ratio and 25.9% net profit increase reaching SAR 3.90 billion. Strategic alliances between insurers and automakers facilitate market expansion while technological investments improve underwriting accuracy and settlement speeds.

Saudi Arabia Motor Insurance Market Industry Segmentation:

The report has segmented the market into the following categories:

Insurance Type Insights:

• Third Party Liability
• Comprehensive

Distribution Channel Insights:

• Agents
• Brokers
• Banks
• Online
• Others

Regional Insights:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region

Competitive Landscape:

The competitive landscape of the industry has also been examined along with the profiles of the key players.

Recent News and Developments in Saudi Arabia Motor Insurance Market

• January 2026: Saudi Arabia’s Insurance Authority rolls out end-to-end digital motor services, enabling online policy issuance, instant policy verification at traffic checkpoints, and electronic accident follow-up to reduce paperwork and accelerate claims resolution in line with Vision 2030 digital goals.
• November 2025: Telematics-based motor insurance gains traction, with safe drivers receiving 15–20% premium discounts as connected devices track speed, braking, and mileage, helping insurers cut underwriting errors by about 10% through richer, behavior-based risk analytics.
• September 2025: Usage-based “pay-as-you-drive” products expand among young drivers and fleets, delivering 25% growth in policies that price cover on real driving time, while mobile apps support 24-hour digital claims, photo-based damage assessment, and faster payouts.
• January 2025: Mandatory comprehensive Takaful cover for financed vehicles formalizes, pushing banks and partners like Al Rajhi Takaful to bundle Sharia-compliant motor insurance with auto loans, and driving a structural shift away from basic third‑party-only cover.

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