Severe Damage from Consecutive Typhoons... Neglected Pungsuhae Insurance

[Image source=Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] Following Typhoon Bavi, Typhoon Maysak passed through the Korean Peninsula, but the subscription rate for the small business flood and wind disaster insurance supported by the government for typhoon-related damages has been found to be low. This is because it was newly introduced this year and has not been sufficiently promoted, and subscriptions are not accepted after a typhoon is forecast.

According to the non-life insurance industry on the 3rd, as of the end of July this year, the number of subscriptions to small business flood and wind disaster insurance was only 5,010. The subscription rates for houses and greenhouses (vinyl houses) were only 19.54% and 11.63%, respectively. This was about 0.35% of the estimated 1,446,000 small business stores and factories targeted by the government for subscription.

Flood and wind disaster insurance was introduced in 2006. It started as a pilot project in cities, counties, and districts in 2018 and was expanded nationwide this year.

By subscribing to flood and wind disaster insurance, compensation of up to 90% can be received for damages caused by eight types of natural disasters including typhoons, heavy rain, storm surges, strong winds, high waves, tidal waves, heavy snow, and earthquakes, based on housing. For small business owners, the government and local governments support 59% of the insurance premium, and in case of flood and wind disaster damage, stores can receive actual compensation up to 100 million KRW, and factories up to 150 million KRW.

Although unexpected typhoon damages have occurred one after another this year, the extremely low subscription rate seems to be due to insufficient promotion. Another reason cited is that insurance coverage is not available after a forecast has been issued.

An official from the non-life insurance industry explained, "The subscription rate for disaster insurance is extremely low, so farms that did not subscribe in advance are expected to suffer significant economic damage from typhoon damage. Crop disaster insurance can be subscribed through NH Nonghyup Insurance, and flood and wind disaster insurance can be subscribed through Nonghyup Insurance, Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, DB Insurance, and KB Insurance."

Meanwhile, following Typhoon Maysak, the 9th typhoon, an even stronger Typhoon Haishen is forecast for next week. Haishen, currently located in the sea northwest of Guam, is moving north toward the Korean Peninsula, raising concerns that not only flooding damage but also crop damage will increase for farms preparing for the Chuseok harvest.

This content was produced with the assistance of AI translation services.