With the government having spent more than NT$42 billion (US$1.4 billion) in the past 14 years on post-disaster reconstruction, Minister of the Interior Lee Hong-yuan (李鴻源) on Wednesday urged the government to purchase insurance to help ease the financial burden of disaster relief.
“Since 1999, the government has spent NT$42 billion in special budgets to deal with reconstruction after the country gets hit by earthquakes and typhoons. However, many Western countries — as well as Japan and South Korea — are purchasing catastrophy insurance, so that insurance companies can partially or completely cover the costs for disaster relief,” Lee told a press conference after returning from Europe last week. “I think buying catastrophy insurance is a good idea, especially for a country like ours that is often hit by earthquakes or typhoons.”
“In the past 30 years, 53 percent of natural disasters worldwide have occurred in Asia, and 12.5 percent occurred in North America,” Lee said. “However, 66 percent of catastrophy insurance payouts have been made to North American countries, while only 9 percent have been paid to Asian countries — which are actually only Japan and South Korea.”
South Korea has purchased insurance to cover damage to its transportation infrastructure, under which the insurance company would help to cover damages caused by natural disasters under NT$50 billion, while the government would pay for disaster relief costs over that amount, he said.
“The government could save a lot of money if we also have such insurance,” Lee said.
He said he has spoken with the Ministry of Financial Affairs and Vice Premier Mao Chi-kuo (毛治國), who support the idea.
“This would be a Cabinet decision, and I will try to convince other ministries, especially the Ministry of Transportation and Communications,” Lee said.