Sucheera Pinijparakarn
The Nation November 28, 2011 12:24 pm
SCSMG is one of the two insurance companies that designed a special policy for those who apply for a Siam Commercial Bank home loan. Its homeowner's policy covers five risks - fire, storms, earthquakes, riots and floods.
Buyers of the policy at Siam Commercial Bank counters will be charged 0.15 per cent per Bt1 million of the home price, which covers only the building.
However, customers directly purchasing home insurance from the company will pay more - 0.2 per cent - but the policy will include all assets as well as the building.
Wachira Chuaychoo, senior executive vice president of SCSMG, said last week that premium rates would go up next year after the severe floods pushed up risk.
At present, the flood premium is only 0.050.1 per cent per Bt1 million, but the General Insurance Association thinks that an appropriate rate should be 22.5 per cent, he said.
Currently, flood-protection premiums range widely from Bt500Bt1,000 per Bt1 million, but policyholders can claim 100 per cent of the sum insured.
Insurance companies have suspended sales of flood insurance upon notice from the Insurance Commission.
Foreign re-insurers are now undecided about reinsuring local insurance companies, for fear floods will reoccur and cause more damage.
In a normal situation, local insurers would renew contracts with foreign re-insurers in November or December.
The company expects to resume selling flood insurance when its re-insurers based in Europe decide to resume reinsuring, which is likely next quarter.
SCSMG's gross premiums this year should expand by 1213 per cent to Bt3.8 billion, of which 80 per cent would be from renewals.
"We earlier estimated gross premiums at higher than Bt3.8 billion, but the flood hit the market in the fourth quarter," he said.
Non-motor policies account for 70 per cent of its total premiums; motor policies for 30 per cent.
The company next year expects its premiums to rise by 20 per cent because the flood situation in Thailand will persuade people to take out insurance. The bank branch distribution channel is another factor to boost premium income, he added.
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