Kuwait Bans Insurers from Revaluing Vehicles or Reducing Compensation After Accidents

KUWAIT CITY, Nov 9 : Kuwait’s Insurance Regulatory Unit has issued new rules governing comprehensive vehicle insurance policies, including provisions that fix the insured value of vehicles and prohibit insurance companies from reducing compensation after a policy has been issued.

The decision also gives qualified insurance companies 90 days to add QR codes to comprehensive insurance policies, while requiring any ambiguity or unclear wording in an insurance policy to be interpreted in favor of the insured.

The new regulations were issued under Decision No. 53 of 2026 by Mohammed Suleiman Al-Otaibi, Chairman of the Supreme Committee of the Insurance Regulatory Unit.

Under the new rules, insurance companies are prohibited, after issuing a policy or once an insured risk has occurred, from reassessing the value of the vehicle or relying on its market value at the time of the accident.

Instead, the value agreed upon when the policy is issued will serve as the basis for calculating compensation.

The decision also prohibits the issuance, granting or marketing of comprehensive insurance policies unless the issuing company is licensed by the Insurance Regulatory Unit and included on the approved list of companies qualified to issue such policies.

Insurance companies are also prohibited from adding exclusions or deductibles that would reduce the fundamental purpose or basic coverage provided under the comprehensive insurance policy or violate the provisions of the new decision.

Companies must price insurance policies in accordance with their applicable insurance agreements or based on the approval of an actuary accredited by the regulatory unit. The insured value must not fall below the prescribed minimum pricing level.

Insurance companies must also inspect and photograph vehicles before issuing insurance policies.

If an insurance company cancels a policy, it must refund premiums for the remaining unused period of coverage. The cancellation of a policy by either party will not be recognized unless it is made through a written document.

Under the new rules, insurance companies must clearly specify whether a damaged vehicle will be repaired at an authorized dealership or at an approved repair workshop.

Companies are also required to provide the insured with a copy of the vehicle inspection report.

The decision further sets restrictions on when a vehicle can be considered a total loss. A vehicle may only be classified as such in cases of technical total loss or economic partial loss, subject to the conditions set out in the regulations.

The rules also require the documentation and assessment of vehicle salvage before any action is taken to dispose of it.

As part of efforts to strengthen the verification and electronic management of insurance policies, the decision requires qualified insurance companies to activate QR codes for electronic insurance documents.

Companies must establish a separate electronic record in their automated systems for every insurance policy issued and link each record to a unique QR code.

The 90-day deadline has been granted to insurance companies to comply with the new QR code requirements for comprehensive insurance policies.

The decision is expected to enhance transparency in Kuwait’s vehicle insurance sector, strengthen consumer protection and prevent disputes over vehicle valuations and compensation after accidents.