Mandatory car insurance discussed

Author: 
By Muhammad Al-Hamzani, Arab News Staff
Publication Date: 
Tue, 2001-05-15 04:35

RIYADH, 15 May  — The Shoura Council is scheduled to discuss in its next sitting a bill for the mandatory third party cooperative insurance scheme for cars which will cover the cars, property, death and damages to victims of an accident in which the insured party is involved, according to a reliable source. This basic insurance service is available in most countries of the world.


An earlier study on insurance recommended the linking of the third party insurance with the buyer’s driving license, a practice followed by sellers of cars on hire purchase, according to sources in the insurance market.


Third party insurance will solve the problem of drivers who are involved in accidents but do not have the means to meet the cost of damage to their victims. Several studies have revealed that most drivers involved in accidents were unable to pay for the damages caused by them to other people and their property. These drivers remain in jail until their obligations are paid, a market source said.


The third party insurance is a necessity as cars are affordable even to people with very low income. The total number of roadworthy cars in the Kingdom is estimated at 6 million. Some victims used to be content with the part payment of the cost of damages offered by poor drivers while others waived their claims in full.


The Saudi government is expected to implement shortly a health insurance scheme to the 6 million expatriates working in the Kingdom.


The cooperative health insurance scheme will be applicable to every wage earning expatriate worker even if he is self-employed. Their income level, nature of employment or duration of employment is not a condition for the insurance coverage.


Non-working residents such as students and those who accompany other expatriate workers, also come under the regulation on condition that the establishment or agencies to which they belong undertake their insurance.


The new regulations exempt all expatriate workers in government establishments and agencies from the scheme. Saudi citizens will come under the health insurance in the second phase of the scheme.

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