Bangkok: The government is set to launch a "disaster insurance" scheme, aiming to involve the private sector in premium contributions to facilitate faster and more substantial compensation for citizens, while reducing government expenditure.
According to Thai News Agency, Deputy Prime Minister Pakorn Nilapraphan highlighted the increasing severity and frequency of natural disasters as a catalyst for this initiative. The government has been exploring various solutions, and the Cabinet has tasked the Ministry of Interior to identify ways to assist the public beyond traditional government subsidies. This has led to discussions on collaborating with the private sector to implement disaster insurance.
The Ministry of Interior has been working alongside the Ministry of Finance, the Office of Insurance Commission (OIC), and the Thai General Insurance Association to study this matter. The proposed model is similar to Japan's approach for natural disasters like earthquakes, floods, and storms. The involvement of private companies in providing insurance coverage is expected to ease the financial burden on the government. Additionally, private companies are anticipated to process claims more swiftly than governmental procedures allow, once specific criteria are met.
This initiative reflects a long-standing interest from the private sector to participate in disaster insurance. Citizens stand to benefit by receiving quicker and larger payments. Currently, government compensation, such as the 9,000 baht provided for damages, often falls short of covering actual repair costs. The disaster insurance concept aims to mitigate this gap, with insurance premiums adjusted based on each area's risk level. The advantage of involving private companies lies in the promptness of payment, provided the necessary conditions are satisfied.
Pakorn emphasized the current challenges of disbursing budget funds, which can be complex and delayed, leading to inadequate support for disaster victims. The proposed insurance scheme, with a payment ceiling, offers a more efficient alternative. While the government's financial assistance may be limited, the insurance model aims to provide more effective care without diminishing government involvement.
Pakorn also mentioned that preliminary discussions among the assigned agencies have taken place, and efforts are underway to finalize the financial details. The intention is to present this principle to the Cabinet promptly, using Japan's model as a reference, to expedite the scheme's implementation.