MSIG opens credit line for flood damages
MSIG Insurance (Thailand) has opened a Bt1-billion emergency credit line to help pay out Bt2 billion for flood damage before receiving all pay-outs from its reinsurers by the end of this year."If the Bt1-billion loan is not sufficient, the company may have to use its reserves of Bt1 billion as additional payment for the [flood-affected] customers. However, the company hopes that the reinsurers can pay all claims by the end of this year," chairman Annop Pornthiti said yesterday.
MSIG had total claims of about Bt15 billion from the 2011 floods and has settled about Bt8 billion, or 60 per cent. The remaining Bt7 billion for large customers is pending inspections by the reinsurers.
The company is trying to pay additional claims of Bt3 billion by March to maintain its capital adequacy at 140-150 per cent. The law requires an insurer to maintain capital adequacy of at least 140 per cent or ask the Insurance Commission for dispensation.
Only Bt3 billion in claims is the responsibility of the company, as MSIG's subsidiaries in the region together took out a Bt15-billion reinsurance policy.
This year, the company targets total insurance premiums of Bt3.5 billion to Bt3.6 billion, up from Bt3 billion last year. Half of this year's premiums are expected to come from automobile policies.
Prawet Ong-aatsitthikul, secretary-general of the Insurance Commission, said all retail customers received payment as a result of the floods, while about 78 per cent of large customers had received payment.
The rest could take some time, particularly for business-interruption claims, because of reinsurers' examinations.