Fraudulent claims affect pricing of insurance policies: Official

Adel Al-Issa, spokesperson for the insurance sector, said that fraudulent claims and operations increase insurance the payments, premiums,  and operating costs incurred by insurance companies. 

He told Al-Eqtisadiah newspaper that this matter, in addition to other factors that affect the pricing of insurance policies, puts everyone in a vicious circle that hinders the sector’s ability to carry out its basic role.

As the financial burden on insurance companies increases, they will be less inclined towards investing in innovative products and services, which will reflect on investment in the insurance sector in general, and lead to its decline, which in turn hinders economic growth and innovation in the insurance sector and the Saudi economy in general, according to the official.

Al-Issa also indicated that there are no official figures or statistics estimating the value of the losses incurred by insurance companies due to fraud las year, noting that the doubled impact of fraudulent activities in vehicle insurance extends to the national economy more broadly.

Source : Argaam