Households, big firms dislike insurance caps
Large corporations are not happy with 30-per-cent protection and households are not satisfied with the Bt100,000 maximum protection under the government-sponsored insurance scheme.
The Cabinet yesterday approved the range of insurance premiums and pay-outs for natural disasters, defined as catastrophic floods, fierce storms and severe earthquakes of 7 or more magnitude, as proposed by Finance Minister Kittiratt Na-Ranong.
The annual premium for households is only 0.5 per cent for coverage of no more than Bt100,000 per event. Households will pay a maximum Bt500 per year.
Homes with minor flood damage would receive Bt30,000, while those under 50-74 centimetres of water would receive Bt50,000. Homes under 75-99cm of water would get Bt75,000, while those under 1 metre or more would be paid the maximum of Bt100,000.
Payungsak Chartsutipol, chairman of the state-run insurance fund, said earlier that he expected about 1.3 million households to join the scheme. Households are advised to take out both catastrophic and minor-flood insurance policies.
Small and medium-sized enterprises will be charged at 1 per cent per year for coverage limited at 30 per cent of the damage or Bt50 million, whichever is lower.
For example, if an SME buys a government insurance policy worth Bt10 million, the catastrophic-protection
coverage, or compensation to the SME, is Bt3 million, while the premium paid by the SME to the fund is Bt30,000 annually.
Large firms would be charged at 1.25 per cent. The protection coverage is limited at 30 per cent of the insured amount, but the insured amount would not be limited.
Sources said large firms wanted more than 30-per-cent protection from the public fund since the market rate for premiums is still high at about 8-10 per cent.
