Oman motor insurance needs smarter pricing

The debate over motor insurance prices in Oman should not be reduced to a simple question of whether premiums will rise. The more important question is whether any future pricing changes will be fair, evidence-based and socially sustainable — especially at a time when many households feel that incomes have not moved at the same pace as living costs.
Recent officially released insurance data point to a critical shift in the market. The headline number of insured traffic accidents may appear broadly stable, but the composition of those accidents is changing. The more serious development is the rise in severe accidents, alongside higher injury-related claims and medical compensation. In practical terms, this suggests the pressure on insurers is not necessarily coming from a dramatic increase in the number of claims, but from the higher cost of each serious claim.
That distinction matters. Insurance markets can often absorb stable claim volumes. What becomes difficult to absorb is a rise in claim severity — especially when accidents involve injuries, treatment costs and longer recovery periods. This creates real technical pressure on pricing, reserves and underwriting performance.
However, recognising that pressure does not automatically justify broad, blanket increases in premiums for all motorists.
Motor insurance is not a luxury purchase. For most people, it is a necessary cost of mobility and daily life. If premiums rise in a broad and uniform way, the burden will fall not only on higher-risk drivers, but also on careful drivers and lower-income households who are already managing fixed financial obligations. In that sense, the issue is not only actuarial; it is also a matter of economic fairness.
This is why Oman needs a more mature conversation about insurance pricing. The real choice is not “raise prices” versus “freeze prices”. The real challenge is whether the market can move towards better pricing — pricing that reflects actual risk more accurately, rather than spreading rising costs across all consumers in the same way.
A fairer approach would mean strengthening risk-based pricing within a clear regulatory framework: rewarding safer driving records, discouraging repeated high-risk behaviour and reducing the sense that disciplined motorists are subsidising costs generated by a smaller group of riskier drivers. That would be better for market trust and better for long-term sustainability.
At the same time, one issue requires careful treatment: the apparent rise in injury and medical compensation. It is tempting to conclude immediately that medical treatment costs in Oman are simply too high, but that would be an incomplete reading. Rising medical compensation may reflect several overlapping factors — including more severe injuries, longer treatment duration, more complex cases and potentially higher service costs in some areas. The responsible position is not to make broad claims, but to call for greater transparency and better breakdowns of cost drivers.
This is where the regulator and the industry can play a constructive role. If pricing pressures are increasing, the public should have clearer visibility on what is driving them: accident severity, medical claims, vehicle repair costs, parts, labour, or claims-management patterns. Better transparency would improve trust and reduce speculation.
Most importantly, this issue should not be treated as a pricing debate alone. It is also a road-safety and public-policy issue. Every severe accident carries financial costs, but also human, social and productivity costs that extend far beyond insurance payouts. If Oman wants to manage insurance affordability over the medium term, the most effective solution is not only pricing reform — it is also reducing the underlying cost of risk through stronger prevention and safer roads.
A balanced way forward is clear: improve road safety to reduce severe accidents, strengthen risk-based pricing to protect fairness and increase transparency so consumers understand why costs are changing.
Insurance market sustainability matters. Consumer affordability matters just as much. Oman’s policy objective should not be to choose one over the other, but to build a system where both can be protected together — through fairness, discipline and smarter risk management.