The hypothesis of making seismic risk coverage mandatory has been discussed for several years, but until now it has never been implemented. It implies an increase in costs for those who have Multi-risk insurance, which currently only includes the risk of fire as mandatory coverage. The Portuguese Association of Insurers (APS) has now presented an estimate of the amount at stake: about 50 euros per year.
In statements to the newspaper Expreso, the president of APS highlighted the importance of this coverage being mandatory. “We are talking about an average annual increase of 50 euros, less than 1 euro per week, little more than a coffee,” compared José Galamba de Oliveira. The official also said that the additional value to the premium may be “lower” in areas with less risk and “slightly higher” in areas with higher risk, such as Lisbon.” The most important thing, he maintains, “is to guarantee that people are protected.”
“The fact that this coverage becomes mandatory makes it more accessible, it is the principle of mutualism. If there are too many people contributing, this reduces the value of the prize. Making coverage mandatory does not mean a brutal increase in the premium,” he added.
At an event this week, the insurance regulator announced that it will move forward with a proposal to create a fund for catastrophic risks, which will have contributions from the APS, Expresso also reported. To the newspaper, the president of the association pointed out that the attempt to legislate and create the fund dates back to the government of José Sócrates, but was conditioned by the troika.
In August of this year, after the 5.3 magnitude earthquake that shook the country from north to south, the APS had already warned that only one in five homes had insurance against seismic risk. “It is necessary to create a protection system against catastrophic risk that protects people and their homes,” he argued.
The association explained that in the country “47% of homes do not have any insurance, 34% have fire or multi-risk insurance, but without seismic risk coverage and only 19% have insurance with seismic risk coverage.” “We are not facing mere uncertainty, but in the face of a real risk, of certain occurrence, at an uncertain time“, highlighted the ASP. He guaranteed that he was available to contribute to this matter and that “on several occasions” he presented to the Government and Parliament a possible solution to protect people and homes.
Source: Observadora
