Partial Loss Depreciation Rules

Partial Loss

• For missing or damaged spare parts, depreciation percentage is applied based on vehicle age:
• Less than one year: 5% deduction
• One year to less than two years: 10% deduction
• Two years to less than three years: 15% deduction
• Three years to less than four years: 20% deduction
• Four years to less than five years: 25% deduction
• Five years and above: 30% deduction
• For tires, deduction rate is 25% for each year or part of its life, up to a maximum of 50% of the value of replacing it with a new one.
• The condition of consumption does not apply to the front and rear glass or door glass.

Total Loss

• Company's liability will not exceed the lesser of the following amounts:
• Estimated value of the vehicle by the insured, with a deduction of 2% for each month or part thereof that has elapsed since the commencement of insurance under the policy.
• Conservation, transportation, and treatment expenses: the company will cover the reasonable cost of transporting a damaged vehicle to a safe place or repair shop, as well as appropriate emergency medical expenses within the limits of the treatment expenses shown in the policy table.

Example of Total Loss

• A person insured his car model 2014 with an insurance company for an amount of 75000 riyals and a premium of 3% for the period from 2018/1/1 to 2018/12/31.
• Accident occurred to the car on 2018/7/5 resulting in a loss that was detailed as follows:
  • Damage to the front part of the car estimated at 10000 riyals.
• If the loss was total, the compensation value would be calculated based on the insurance amount.