Flood Losses Prompt Key Changes in Thai Insurance Industry

Insurers’ estimates of industry wide losses from the Thailand floods have increased 50% to USD 15 billion since A.M. Best’s last briefing on this event (Thai Flooding Brings Industrial, Business Interruption Claims), published Nov. 23, 2011. Such a loss would place the Thai floods in a tie for the fifth costliest insured loss event in the past 31 years. Aon Benfield estimated the floods in Thailand have damaged or destroyed more than 4 million homes, businesses and manufacturing facilities. This has generated structural damage four times greater than what resulted from Japan’s earthquake and tsunami in March 2011, but only half of the total insured loss due to a low rate of insurance adoption.