View this article online: https://www.insurancejournal.com/news/international/2002/09/02/22731.htm
Typhoon Rusa battered the So. Korean peninsula over the weekend with 130 mph winds and torrential rains, leaving at least 50 persons dead and many more missing, in what authorities described as the most severe storm in 40 years, and in all likelihood the most costly.
The storm washed out roads and bridges, bringing ground traffic to a standstill, and caused extensive property damage from floods and landslides. A government spokesman told Reuters News Agency that “the damage to property is expected to be the largest in history.”
President Kim Dae-Jung, who had earlier ordered army troops to assist in relief efforts, called an emergency cabinet meeting to direct clean up and recovery operations.
Rusa was the most violent storm to hit So. Korea since 1959, when 840 people lost their lives, but in terms of property damage, it will be substantially more costly, due to the country’s economic development over the last 40 years. Preliminary damage estimates put the cost at Kr. won 255 billion (around $215 million), but the figures are expected to increases significantly as more damage reports are recorded.
The extent of the insured losses cannot yet be measured, but the typhoon comes on top of some already depressing news from So. Korea’s non-life insurers. Although still posting net profits of around $136 million for the period of April 1 through June 30, the companies experienced a 63.3 percent decline in, net income compared to the same period last year. The drop was due mainly to the sharp falls in global equity markets, and the generally weakened investment climate with income in the sector falling by over 50 percent overall.
While premiums in So. Korea are generally on the rise, as they are elsewhere, the losses from Rusa’s ravages, may well further lower profit margins.