Typhoon Hinnamnor Floods 4,100 Vehicles... Damage Costs Hundreds of Billions of Won

On the 4th, a vehicle passes along the coastal road of Songaksan, Jeju Island, which was flooded by Typhoon Hinnamnor. [Image source=Yonhap News]

[Asia Economy Reporter Changhwan Lee] It has been confirmed that over 4,100 vehicles nationwide suffered flood damage worth approximately 33 billion KRW due to Typhoon Hinnamnor. The scale of vehicle flood damage caused by this year's heavy rains and typhoons is the largest ever recorded.

According to the insurance industry on the 7th, as of 3 p.m. the previous day, a total of 4,104 cases (estimated) of vehicle flood damage caused by Hinnamnor were reported to 12 domestic non-life insurance companies. The estimated damage amount reached 33.642 billion KRW.

The four major companies?Samsung Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and KB Insurance?received 3,488 reports of vehicle flood damage, with an estimated damage amount of 28.595 billion KRW.

Typhoon damage occurred in Pohang, Gyeongju, Ulsan, Jeju, and other areas. In particular, in Pohang, Gyeongbuk, which suffered the worst damage, it is known that about 1,500 vehicles were flooded.

Since flood damage reports continue to be received, the scale of damage is expected to increase further as of this date.

The scale of vehicle flood damage caused by typhoons and heavy rains this year is the largest ever. Due to the concentrated heavy rain centered around Gangnam, Seoul last month, 11,685 flooded vehicles were reported to insurance companies at that time, with an estimated damage amount of 163.7 billion KRW.

When combined with the damage from Typhoon Hinnamnor, the estimated damage amount is expected to exceed 200 billion KRW. This far surpasses the damage amount of 115.7 billion KRW caused by Typhoons Bavi, Maysak, and Haishen in 2020.

The increased damage this year is because last month's heavy rain poured mainly over affluent areas concentrated in Gangnam, resulting in many luxury cars being flooded. At that time, more than 3,000 foreign cars suffered flood damage.

Less than a month after the flood damage caused by last month's concentrated heavy rain, large-scale vehicle flood damage occurred again due to the landing impact of Typhoon Hinnamnor, raising concerns among non-life insurers about an increase in automobile insurance loss ratios.

Non-life insurers expect that the automobile insurance loss ratio will rise by 2 to 3 percentage points compared to the previous month due to the concentrated heavy rain last month. Although insurers made significant profits in the first half of the year as automobile insurance loss ratios improved due to reduced vehicle traffic caused by the resurgence of COVID-19, they expect the scale of profits to decrease in the second half.

This is also predicted to affect the financial authorities' pressure to reduce automobile insurance premiums. The Financial Supervisory Service has announced plans to encourage insurers to lower premiums in the second half. However, if the impact of typhoons or heavy rains increases, the reduction of automobile insurance premiums may be postponed.

Researcher Hyejin Park of Daishin Securities predicted, "Following the record-breaking heavy rain in August and the strong typhoon in September, it will not be easy to reduce insurance premiums within this year."

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