The insurer wants its money back— can it do that?

After a car accident is settled, you might be surprised to get a call from your car insurance company saying that you need to pay them back the money they paid for the accident. In Saudi, car insurance companies have the right to pursue recovery from the at-fault party up to a YEAR after the accident. There are lots of reasons why this can happen, and two things you can do if you find yourself in this situation.

Why might your insurance company be asking for their money back?

Your insurance company might ask you for money back because of something called the ‘right of recovery.’ This is a common clause in all TPL (Third Party Liability) and comprehensive car insurance policies in Saudi Arabia.

Basically, the ‘right of recovery’ allows your insurance company to ask you to pay all the money they paid out for an accident if it turns out you broke the terms of your policy.

Your insurance company could ask for their money, if:

1. you were probably driving without ‘reasonable care’

Your insurance company can ask you to pay back what they’ve already paid out, if reckless driving was the cause of your car accident. By reckless driving, we mean:

• Racing
• Drifting
• Running a red light
• Driving on the wrong side of the road

Not only do these acts violate traffic rules, but they also violate the terms of your insurance policy. So, you can’t really expect your car insurance to pay for the accident if you were breaking the rules.

2. you gave out incorrect information to the car insurance company

Similarly, your car insurance company has the right to ask for the money they’ve already paid out, if you might have given incomplete or inaccurate details during your claim, or even when you were getting a quote for your car insurance — intentionally or by mistake. This could be considered motor fraud!

To avoid this, it’s super important to be careful while filling out those forms and to keep your insurance company updated if anything changes about your car or your driving situation.

3. someone else while driving your car

If you have comprehensive car insurance, but let someone drive your car without your insurance company knowing, you will be responsible for paying back any accident costs if that person causes an accident.

To avoid this, make sure to add anyone who frequently uses your car to your insurance policy as an additional driver.

4. You were driving with an expired license

Having an expired driving license at the time of an accident can be another reason for your car insurance company to ask for the money they spent back. A valid driving license shows that you are qualified and competent to drive a car.

To avoid you need to renew your expired driving license within (50) days from the date of the accident.

What to do when your insurance company asks for a refund?

If your insurance company asks for a refund, the first step is to review your policy. Double-check your policy to make sure the reasons they’re giving are valid. If something seems off, contact your insurance company for clarification.

If you disagree with their reasons, file a formal complaint

To file a formal complaint against an insurance company in Saudi, you need to reach out to the Insurance Authority. That’s the government agency that investigates complaints from individuals about car insurance companies in Saudi Arabia.

You can file a complaint with the Insurance Authority online, or phone Consumer Protection Department (IA Care) on 800 124 0551 from Saturday to Thursday (8:00 AM – 9:00 PM) or Friday (2:00 PM – 6:00 PM).

Otherwise, you can negotiate a payment plan

If your insurance company has valid reasons but you can’t afford to pay the money — don’t panic! Here’s what you can do:

• Reach out to your insurance company and explain your financial situation. You may even be able to negotiate to reduce the amount I need to pay back
• Suggest a payment plan that outlines how much you can afford to pay each month.
• Make sure to document any agreement in writing to avoid misunderstandings.

Bottomline

Now that you know about the “right of recovery” and understand the situation where your insurer might ask for their money back, you can take some proactive steps to avoid any surprise bills later. Make sure to provide accurate information when you use websites to compare car insurance prices, or you might get yourself into trouble later!

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