The cost of the cyclone and natural disaster insurance for Fiji is going up and unless we change the building codes in Fiji, buying cyclone insurance will be very difficult.
This has been highlighted by Aon (Fiji) Pte Limited General Manager, Sahreena Mohammed while the Fiji Insurance Brokers Association was making a submission to the Parliamentary Standing Committee on Economic Affairs on the Reserve Bank of Fiji 2018 Annual Report.
Mohammed says buildings in Fiji are built with focus on health and safety of people rather than natural disasters.
She says every insurer is there to make a profit for themselves and the cost of insurance is inclusive of expenses and they have to allow margins for a profit.
Mohammed explains that in New Zealand, earthquake insurance cover for the zone of Wellington is not affordable as it is an earthquake prone zone.
She adds the probability of cyclones in Fiji is one in a year and insurers are more aware with the powerful data that they now have,that makes it possible to cause continued damages in the region.
Mohammed says this has an effect on the rising cost of insurance on cyclone covers.
She further says it would help if new buildings that are being constructed are built to cyclone certification adding currently this is not compulsory but a matter of choice where people can choose to what strength they build their buildings and structurally this is not as strong to withstand cyclones.
Mohammed says we don't know where the insurance industry will end up in the next year but from the 2018 and 2019 events for natural disasters and the high topic of climate change that we are seeing, undoubtedly the cost of insurance and the cost of cyclone and natural disaster insurance for Fiji is going up.
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