Thailand’s newly established natural catastrophe pool is looking to buy close to Baht20bn ($632m) of reinsurance protection from international carriers, according to the country’s insurance regulator.
The Baht50bn fund was established in the wake of the devastating flooding in Thailand that contributed significantly to the international insurance industry’s record claims bill and has proved popular particularly with homeowners.
So far, around 4,000 customers have turned to the state-backed pool for cover,close to 80% of which are householders.
Now Thai officials are calling for a regional catastrophe pool for south-east Asia that would offer enhanced protection for those countries without the financial resources to set up their own government-backed fund.
Thailand’s Office of the Insurance Commission (OIC) intends to propose the creation of a regional pool when it hosts a meeting of Asean insurance regulators later this year. It has already received support from South Korea, as the financial supervisors of the two countries signed an agreement on regulatory co-operation this week.
Pravej Ongartsittigul, secretary-general of OIC, acknowledged not every country in the region was in a position to set up such a fund and suggested a regional approach would be more effective in the face of the expected in-flow of investment in the coming years.
His sentiment was supported by Kim Seok-dong, chairman of South Korean’s Financial Services Commission.