RIYADH — The Insurance Authority said offering or selling the “Extended Warranty” product without its required license is a clear violation of the Cooperative Insurance Companies Control Law. The warning applies to car dealerships, retailers and all other entities that offer the product.
The authority said in a statement that engaging in any insurance activity without the required license is a clear violation of regulations. Violators will face a maximum fine of SR2 million and up to four years in prison, or either of these penalties, in addition to legal action under relevant laws.
The authority clarified that only licensed and duly registered insurance companies may offer extended warranty in Saudi Arabia. The authority said it had detected violations in the offering and sale of extended warranty as part of its ongoing work with relevant authorities to monitor compliance with insurance sector rules and instructions. It said a number of retailers and car dealerships were found offering the product without a license from the Insurance Authority.
The authority called on all commercial entities to comply with the rules and instructions governing insurance business. It also urged individuals and entities to report any violations through the authority’s approved official channels.
Source: Saudi Gazette