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Property insurance costs up 30 per cent

Property insurance costs up 30 per cent


Forte Insurance Photograph: Vireak Mai/Phnom Penh Post

The cost of property insurance in Cambodia increased by more than 30 per cent in the first five months of this year, compared to the same period in 2011, according to the latest data from the Insurance Association of Cambodia.

Ty Atith, an assistant to the general director of the Insurance Association of Cambodia, said that the amount customers paid for insurance services on property nationwide for the first five months of the year was $4 million, an increase of 33 percent compared to the same period in 2011, which was $3 million.

He said that the cause was an increase in claims resulting from fires in factory buildings and houses.

He added that the country’s economic growth and the increase of investment in construction in the country has risen gradually, leading to an increase in claims.

Youk Chamroeunrith, director of FORTE, said property insurance cost grow every year as Cambodian people start gaining a broader knowledge of the benefits of insurance.  He said that if there are more customers borrowing money from banks, it will increase by a similar amount.

The FORTE director added that property insurance is used for skyscrapers, homes, factories, hotels, restaurants and gasoline stations.  He said that all types of sections of insurance have increased while the economy grows, including in construction, agriculture, the garment industry, tourism, and banking.

Chamroeunrith said that generally Cambodian people have a better understanding of the benefits of buying insurance. “There is an increase in customers for insurance for the first five months of 2012, he said, adding that for the last two or three years real estate in Cambodia has been severely affected by fire and natural disasters.

Chheng Kimlong, a lecturer in business and economics at the University of Cambodia said that property insurance has yet to develop properly, but it is n Cambodia’s interest guard against fire as well as natural disasters like floods and storms.

He said that insurance services help maintain investment in Cambodia and increase state income through the paying tax on profits from companies offering this type of business. Moreover, it can help Cambodian people get more jobs in the sector.

To contact the reporter on this story: Seun Son at [email protected]