SAMA’s 2026 telematics greenlight could push Saudi InsurTech to USD 1.39 billion by 2034, growing at 31.1% CAGR. That single regulatory shift is changing how insurance works in the Kingdom.
The new rules allow insurers to use tracking technology in both car and health policies. This means premiums can now adjust based on real behavior. Driving speed. Harsh braking. Even daily step counts. Insurance pricing is moving from static tables to live data streams.
This marks a defining moment for telematics insurance in KSA.
Saudi Arabia’s broader auto insurance market was valued at USD 8 billion in 2023. Now, connected car technologies are being adopted by insurers such as Tawuniya and Bupa Arabia. These firms are leveraging telematics to improve risk assessment and personalize pricing.
This shift also aligns closely with Saudi Central Bank (SAMA)’s digital transformation push under Vision 2030. Insurance is no longer just about pooled risk. It is about measurable behavior.
From Actuarial Tables to Real-Time Behavior
For decades, actuaries calculated premiums using historical averages. Age. Car model. Claims history. But telematics changes the logic.
Pay-how-you-drive (PHYD) models use live driving data. They measure speed, braking patterns, mileage, and driving time. Premiums adjust according to actual risk exposure.
Globally, telematics insurance reached 216 million active premiums in 2025. It is projected to reach 278 million in 2026. This rapid growth shows that usage-based insurance is not a niche trend. It is becoming mainstream.
Meanwhile, in KSA, PHYD adoption is still early but expanding fast. The telematics segment is growing at a 25% CAGR through 2028. This growth reflects strong demand for usage-based insurance models. Drivers want fairness. Safe drivers expect lower premiums.
Health insurance is also entering this dynamic pricing era. Under the new 2026 SAMA rules, insurers can use metrics such as step counts. That means healthy lifestyle behavior may translate into lower premiums. This creates a direct link between personal habits and insurance cost.
The Saudi InsurTech market was valued at USD 121.5 million in 2025. It is forecast to reach USD 1.39 billion by 2034. That is a 31.1% CAGR. The regulatory approval of telematics is a major driver behind this surge.
The key insight is clear. Data analytics firms are becoming central players.
Traditional actuaries relied on probability models built from past data. Now, insurance depends on real-time analytics engines. The power is shifting from static underwriting to continuous risk monitoring.
This transformation is disrupting the insurance value chain. Technology providers. Data specialists. Connected car platforms. All are gaining strategic importance. Insurers must either build strong analytics capabilities or partner with data firms that can process massive volumes of behavioral data.
For Saudi Arabia, this evolution strengthens its digital ecosystem. It supports innovation under Vision 2030. It encourages competition in InsurTech. It also raises important questions about data governance and customer trust.
Still, the direction is clear.
Telematics insurance in KSA is moving from experimental pilot projects to regulatory-backed reality. With a USD 8 billion auto insurance market and fast-growing InsurTech investment, the Kingdom is positioning itself as a regional leader in usage-based insurance.
The winners will not only be insurers. The real powerhouses may be the analytics platforms behind the scenes. In 2026 and beyond, insurance pricing in Saudi Arabia will no longer be based on who you are. It will be based on what you do.
