Logo of Phnom Penh Post newspaper Phnom Penh Post - Fire insurance spreads on growing risk awareness

Fire insurance spreads on growing risk awareness

Firefighters attend the scene of a fire late last year in central Phnom Penh.
Firefighters attend the scene of a fire late last year in central Phnom Penh. Vireak Mai

Fire insurance spreads on growing risk awareness

Property and fire insurance premiums surged 35 per cent last year to reach $24.5 million, leading all other segments of the insurance sector in terms of premium growth and accounting for nearly 40 per cent of total premiums, Cambodia’s insurance industry body said yesterday.

Huy Vatharo, chairman and managing director of the Insurance Association of Cambodia (IAC), said growing awareness of property and fire hazards, and an influx of foreign investment, was driving the segment’s strong growth.

“Most of the growth in fire insurance is from companies, factories and institutions, as they understand the risks fire places on their business,” he said.

“Growth in foreign direct investment also pushes the growth of this type of insurance, as investors want to protect their property.”

Local insurers have reported strong growth in property and fire insurance policies, which are used to protect homes, factories, offices, hotels and restaurants.

Forte Insurance said its total property and fire insurance premiums increased 28 per cent in 2015, compared to a year earlier.

Jenny Huynh, the company’s assistant vice president of marketing and communication, said increasing home ownership is driving the growth of this segment as buyers want to protect their investment and many banks require residential units have fire insurance policies before issuing loans.

“More locals understand the risk exposure better, [so they] buy fire insurance, or the property was bought under a bank loan, which means the bank would require fire insurance in place to disburse the housing loan,” she said.

“Most foreigners buying properties would buy insurance automatically as they will usually get bank loans as well.”

Huynh explained that while Cambodian law does not require the purchase of fire insurance for any type of occupied property, the government requires construction property developers to buy contractor’s all risks insurance. Without this policy, developers are not able to obtain a permit to sell their development before completion.

Cambodia’s total premiums for general insurance increased from $53 million in 2014 to $61.6 million in 2015, according to IAC. Medical insurance had the second largest year-on-year growth at 26 per cent, followed by personal accident insurance at 18.8 per cent and vehicle insurance at 14.5 per cent.

MOST VIEWED

  • US imposes sanctions on Oknha Pheap and Kun Kim

    The Ministry of Foreign Affairs and International Cooperation expressed strong dismay on Monday over the designation of Cambodian tycoon Oknha Try Pheap and General Kun Kim under the US’ Global Magnitsky Act. “It is very disturbing when the public figures of a country become the

  • Mother, daughter killed in hotel fire

    The bodies of a mother and daughter were found locked in an embrace after they were killed in a hotel fire in Phnom Penh at around 3:30am on Wednesday at the Phkar Chhouk Tep 2 Hotel and Restaurant in Phsar Doeum Kor commune, in the capital’

  • EBA withdrawal a destruction of EU achievements, PM says

    Prime Minister Hun Sen said the EU’s possible suspension of its Everything But Arms (EBA) agreement amounted to a destruction of its achievements in the Kingdom and the demise of the opposition group. Hun Sen made the remarks while addressing more than 6,700 students during

  • Rights Day forum denied in Sihanoukville

    The Preah Sihanouk provincial administration last Saturday denied the request of land communities for a public location in the province to celebrate International Human Rights Day 2019 as the administration had already held forums to discuss land issues. However, the land community representatives said they would

  • US told to refrain from interfering in Sokha case

    Senior Cambodian officials said on Thursday that the US can monitor Kem Sokha’s trial as it wishes but would not be allowed to interfere in court procedures. The point was made in response to US Secretary of State Mike Pompeo’s comments on Wednesday

  • Europe expected to consider EBA efforts, impact

    The government said it expects the European Commission to consider its efforts to comply with the “Everything But Arms” (EBA) regulations and the impact on one million workers should access to the agreement be suspended in February. The Ministry of Foreign Affairs and International Cooperation