Any Motor Vehicle governed by financially leasing contract to individuals shall be insured according to the provisions of these Rules. No amendments shall be allowed to the insurance coverage to go beyond the minimum limits set by these Rules, such as amendments to the coverage, conditions, provisions, or exclusions.

The Lessor must include the name of the Lessee in the “vehicle registration” as the “actual user” of the Motor Vehicle.

The Lessor shall insure the Motor Vehicle annually during the period of the finance leasing contract.

The Lessor shall obtain insurance offers from at least three Insurers, and chose the best offer and lower price and provide it to the Lessee.

1. The Insurance Premium shall be calculated annually by the Insurer based on the changes on the Sum Insured and the pricing factors for the Lessee. The Lessor shall provide the Insurer with the Lessee’s information in the Insurance Form which is required the pricing; after obtaining the Lessee’s approval.

2. The Lessee shall provide the Lessor with any Material Changes to his/her data, which have been previously submitted to the Insurer and which effect the insurance Premium.

3. The Insurer shall provide the Lessor with The Actual Amount of the Premium along with the Premium amount after applying the Discounts, if the Lessee is eligible for any.

4.The Lessor shall calculate the Premium amount on the Lessee at the beginning of the finance leasing contract, based on the Actual Amount of the Premium. (as the explanatory example below)

5.At the end of the insurance year, the Lessor shall calculate the balance amount of what have been paid to the Insurer, and what have been paid by the Lessee, and keep it in the Lessee Insurance Account, and provide the lessee with a copy of the Lessee Insurance Account.

6.At the end of the finance contract between the lessee and the Lessor, the Lessor shall pay back the Lessee the extra amount of Premiums paid by the Lessee or shall ask the Lessee to pay the extra amount paid by the Lessor to the Insurer for the insurance Policy.

7. The accounts settlement related to the insurance Policy shall be made within (30) days from the termination date of the agreement between the Lessor and the Lessee.

Explanatory example:

First year:

Motor Vehicle Value: 100,000 SAR.

The Actual Amount of Premium: 4,000 SAR. SAR.

The Premium amount after applying Discounts: (for example, no claim discount 30%): 2,800 SAR. The Lessor computes the Premium amount on the Lessee based on The Actual Amount of Premium (4,000) SAR and saves the different between The Actual Amount of Insurance Premium and the Premium amount after applying the Discounts: (4,000-2,800=1,200) SAR added to the Lessee Insurance Account.

Second year:

Motor Vehicle value: 80,000 SAR. (after applying depreciation percentage).

The Actual Amount of Premium: 3,200 SAR.

The Premium amount after applying Discounts: (for example, no claim discount 40%): 1,920 SAR.

The different between The Actual Amount of Premium and the Premium amount after applying the Discounts: (3,200-1,920=1,280) SAR added to the Lessee Insurance Account. The Lessee Insurance Account balance: (first year: 1,200+second year: 1,280=2,480) SAR.

Third year:

Motor Vehicle value: 70,000 SAR.

The Actual Amount of Premium: 2,800 SAR.

No amount will be added to the Lessee Insurance Account if he/she is not eligible for any Discounts for having an accident.

At the end of the finance lease contract, the amount withdrew from the Lessee and the amount paid to the Insurer are subjected to liquidation, as follow:

Amount withdrew from the Lessee: 4,000+3,200+2,800=10,000 SAR. Amount paid to the Insurer: 2,800+1,900+2,800=7,520 SAR.

7,520-10,000=2,480 SAR to be paid back to the Lessee.

The Lessor and the Lessee shall agree at the beginning of the finance leasing contract on the annual depreciation percentage, which shall be stated in the Insurance Form

Only the Lessee shall have the right to request Additional Benefits to the Policy and determine the Deductible amount.

The Lessor and the Lessee shall agree on the method of repairs to take place (dealerships or certified auto repair shops) in The Insurance Form.

1-The Lessor shall explain to the Lessee the scope of insurance coverage as well as the conditions, provisions and exclusions applicable to the Policy.

2-The Lessor shall provide the Lessee with a hard or electronic copy of the Policy at the beginning of the finance leasing contract and at every renewal of the Policy.

Sum Insured Calculation:

The Sum Insured is determined in the first year following registration of the Motor Vehicle at the authorized authority based on the retail price offered by the certified dealership for the insured Motor Vehicle (excluding finance amounts or any other future services), provided that the value will be subject to the annually depreciation percentage, as specified in the Insurance Form as to reflect its real value at the time of renewal.