Insurance rates are slightly more in Dhofar, North and South Al Batinah, where natural disasters often occur.
Muscat: Did you know that vehicle insurance rates vary from place to place in Oman?
An official said that vehicle insurance rates are slightly more in the governorates of Dhofar, North and South Al Batinah, compared to other governorates in the Sultanate of Oman, where previous places often witness natural disasters. “This is one of the reasons why vehicle insurance rates differ from one place to another,” an official in the Capital Markets Authority said.
Speaking about the possibilities facing the insurance industry, including being forced to keep prices competitive and the increasing cost of insurance coverage, an official from the Capital Market Authority, speaking exclusively to The Times of Oman, said, “Insurance companies have witnessed a significant decline in insurance and many of them are incurring heavy losses due to the circumstances. The adverse climatic conditions that hit the Sultanate, such as the one witnessed in the form of Cyclone Shaheen in October 2021 and the heavy rains it witnessed recently, which caused the flooding of valleys and valleys, causing flooding, deaths or injuries to motorists and neglected tourists.”
He said: Then there are the high prices of spare parts and the high costs in the repair shops that must be faced. All this has had a significant impact on insurance companies in recent months, forcing them to take measures to ensure their economic viability and sustainability in the market.”
The CMA official also said that over the past few years, insurance rates have been kept deliberately low in the face of intense competition in the market. This baggage has had to be corrected in the past few years at one point or another. Because of these corrections, insurance rates have skyrocketed in recent months.
“We have noticed a drop in insurance rates in the past few years – the third party insurance rate in some insurance companies has gone down to OMR 37. This was due to the intensity of competition between companies. In order to remain financially viable and sustain themselves, they were left with nothing but Little choice but to make corrections.
He said the premium rates also depend on the type of vehicle, location of the policy holder, age of the policy holder, etc., adding that insurance companies are also investigating whether the policy holder has any traffic violations, including accidents. registered against his name.
If the used car is imported, companies assess whether or not it has been involved in accidents. There were cases when buyers imported used but damaged cars, which were then repaired with cheap parts. After they are insured, and in the event of a second accident in the Sultanate and subsequent damages, buyers demand insurance for expensive spare parts and materials, causing the company to incur losses.
Besides, cars manufactured after 2018, especially those made of European or American style, must necessarily be repaired in authorized workshops. Now, since these workshops are also parts sellers, they often exaggerate the damage done to the car in an accident.
These damages may not be a direct result of the accident, but while claiming insurance, “damages” are included in the business cards prepared in the workshops. Of course, insurance companies are obligated to pay more than they would have paid for damages sustained in the accident.
“This also prompted insurance companies to raise insurance rates,” he said.
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