Finance Ministry to launch national disaster insurance

Thansettakij•Economy•6d ago

Reader Briefing

The Ministry of Finance is developing a new national disaster insurance system to cover 30 million households and reduce the government's budgetary burden.

•The Ministry of Finance and OIC are developing a new disaster insurance system approved by the Cabinet and OIC Board.
•The government proposes an annual budget of 15 billion baht for premiums to provide total coverage of up to 75 billion baht.
•Approximately 30 million households nationwide will receive automatic coverage without needing to register.
•The system is expected to be implemented within this year.

Overview

•The Cabinet and the OIC Board have approved the national disaster insurance project.
•The project aims to transfer risk from the government budget to an international standard insurance system to reduce central budget allocations for annual disaster relief.
•The government currently spends an average of 30 billion baht per year on disaster relief according to DDPM data.
•The government proposes spending 15 billion baht per year on insurance premiums for approximately 30 million households.
•The insurance policy will provide a total maximum coverage of 75 billion baht.
•The Thai General Insurance Association will act as the insurer, distribute risk among insurance companies, and utilize international re-insurance.
•Scientific technology and satellite imagery will be used to evaluate flooding to expedite initial relief payments of 10,000 baht.
•Actual property damage will be assessed up to a maximum amount of 100,000 baht.

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Key Quotes

Lavaron Sangsnit

"The Thai General Insurance Association will be the insurer and distribute risk to insurance companies based on the potential and strength of each company, while arranging re-insurance in international markets to move risk out of the country."

สมาคมประกันวินาศภัยไทยจะเป็นผู้รับประกัน และกระจายความเสี่ยงไปยังบริษัทประกันภัยตามศักยภาพและความแข็งแกร่งของแต่ละบริษัท พร้อมทั้งมีการจัดทำประกันภัยต่อ (Re-insurance) ไปยังตลาดต่างประเทศ เพื่อย้ายความเสี่ยงออกนอกประเทศอีกทางหนึ่ง

Key Entities

Person

Lavaron Sangsnit(ลวรณ แสงสนิท)

Permanent Secretary of the Ministry of Finance.

Organization

Ministry of Finance(กระทรวงการคลัง)ℹ️

The government ministry overseeing the national disaster insurance project.

Office of Insurance Commission(สำนักงานคณะกรรมการกำกับและส่งเสริมการประกอบธุรกิจประกันภัย)ℹ️

The agency collaborating with the Ministry of Finance to develop the new disaster insurance system.

Cabinet(คณะรัฐมนตรี)

The government body that approved the national disaster insurance project.

Department of Disaster Prevention and Mitigation(กรมป้องกันและบรรเทาสาธารณภัย)

The agency providing data on annual government disaster relief spending.

Thai General Insurance Association(สมาคมประกันวินาศภัยไทย)

The entity that will act as the insurer and distribute risk to various insurance companies.

Policy

National Disaster Insurance Project(โครงการประกันภัยพิบัติแห่งชาติ)

A project to transfer disaster risk from the government budget to an insurance system covering 30 million households.