IQ Test For Kids

Property insurance provides protection for everything a person owns or rents from all kinds of dangers or damages that may be caused by various accidents such as fires, natural disasters, thefts and others. Coverage in the insurance sectors in the Kingdom of Saudi Arabia includes various and different types of insurances such as home insurance and its contents, insurance for stores and the goods they contain, insurance for buildings, companies and industrial establishments and all their workshops and others.

How to take advantage of property insurance

The customer, the owner of the property, signs a contract with the insurance company of his choice to insure one or all of his property, and the customer pays the company according to this contract a monthly installment that matches the value of his property that he insures to protect it from the risks that he chooses to cover. And when an accident occurs that results in damage to the property or leads to its loss, the insurance company is obligated to pay the value of these losses or to repair the damages that occurred to the insured property in accordance with what is stated in the contract concluded by the two parties.

Non-oil economic activity in Saudi Arabia

Since 2016 until the time of writing this report in 2020, the Saudi economy has been suffering from a noticeable slowdown in its growth, as the gross domestic product increased by 1.4% only, due to the limited growth also of the private and non-oil sectors, which recorded a growth of 0.11% and 0%. Only 23%. As for the government and oil sectors, their rates were better, as the government sector grew by 0.51% and the oil sector by 3.37%.

But what is the relationship of economic activity with insurance?

The slowdown of the economy and the decline in macroeconomic indicators in the Kingdom of Saudi Arabia is a clear reflection of the decline in economic activity, and this leads directly to a decline in insurance activity in general.

Insurance sector in the Kingdom of Saudi Arabia

During the last years since 2013, insurance activities in the Kingdom of Saudi Arabia have witnessed a strong growth thanks to the support they receive from the improvement of the regulatory environment and the application of compulsory insurance on several properties and good health insurance. The success of these sectors has contributed to the population expansion and the tendency of workers to work in the private sector and increase the number of cars. And increase the awareness of citizens and residents of the need to obtain insurance.

In the foreseeable future, economists expect the government to strengthen the non-oil sector in Saudi Arabia
And providing greater business opportunities in the insurance sectors.

The contribution of the insurance sector to the local Saudi economy

 So far, the contributions of the insurance sector to the non-oil GDP are still very low, as the 2016 insurance sector report in the Kingdom of Saudi Arabia indicates that the non-oil insurance depth rate - which indicates the contribution of the insurance sector to the GDP - has stabilized at 2% Only in 2016, while the ratio of total assets belonging to the insurance sector to non-oil GDP was only 3% for the same period, which is a modest and very small percentage and indicates the small size of the property insurance sector in the Kingdom of Saudi Arabia.

On the other hand, the rate of individuals' spending on insurance in Saudi Arabia (the so-called insurance density rate) has suffered from a clear decline over recent years, and if we compare the rate of insurance depth and density with other countries, we notice a decrease in Saudi Arabia, stressing that the insurance sector is still He has developed and has until today great untapped potential opportunities and future.

Property insurance service providers in the Kingdom of Saudi Arabia

There are 35 insurance companies listed in the Saudi stock market. These companies practice various main insurance activities, which are health insurance, general insurance, protection and savings insurance. General insurance in Saudi companies includes seven sub-activities, namely vehicle insurance, marine and aviation insurance, energy, engineering insurance, liability and accident insurance, property and fire insurance. In addition, there are 27 insurance companies in Saudi Arabia that provide health insurance services, 28 companies specializing in general insurance, and 11 companies that provide protection and savings insurance services.

Types of risks covered by property insurance

1. Risks and damage to buildings and their contents, since insurance companies cover all costs derived from damages that may be caused to buildings and their contents.
2.  Theft operations, since the insurance policy can cover all losses and damages resulting from theft.
3.  Responsibility, and means compensation to the insured for all sums owed by the person responsible in his capacity as owner.
4.  Fire insurance.
5.  Lightning insurance.
6.  Insurance against business interruption, to insure losses derived from work interruption or irregularity.