Insurance Vs Risk: The Value of Peace of Mind

Feb. 16, 2017, 12:04 p.m.

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In Cambodia there are remarkably low penetration levels of insurance – among the lowest in the world. This results in risk and insecurity for those with assets such as property.

Cambodians are, however, starting to realize the benefits that investing in insurance can bring and Cambodia’s insurance industry is rapidly expanding. For the consumer, this means more and more affordable ways to protect your vehicle, home and business.

The majority of companies in Cambodia invest in property insurance.

This means, for example, if the business is a manufacturing factory then this insurance would protect that business against the danger of fire and flooding. There has also been a surge in businesses buying interruption policies. Properties can be insured up to the cost of construction by owners or renters. Get in touch with one of Realestate.com.kh’s professional insurance contacts today and find out just how affordable peace of mind for your business assets can be. Khmer’s who are insured already generally tend to be older, aged 35 or above, and these Khmers are aware of the risks that exist and have enough assets that their risk is significant. Insurance gives peace of mind in protecting those assets.

Residential property owners however are largely uninsured or underinsured in Cambodia.

This is a very risky state of affairs and in some ways illogical when the cost of insurance is considered. For example, if your 3 bedroom home in Toul Kork, Phnom Penh, valued at $200,000 was to be damaged by fire, storm or a flood – it would cost all of your life savings to rebuild. An appropriate policy covering you against this risk might cost less than your lunch on a daily basis! Meanwhile, your life savings would be free from the burden of rebuilding your home, as would your mind be free from stress of that risk.Taking out property insurance if you’re renting a property in Cambodia is wise too, unless it’s written in your lease agreement that you are not responsible for damages to that property. These rental documents are typically very small, and may be unclear about the liability for damage to the building – so check with an insurance advisor or lawyer to guarantee you are covered for everything you think you are covered for.

Insurance experts can help you identify where risk exists, quantify and analyze the various components of that risk, and help to develop suitable risk response strategies. Finally, they will offer you an insurance policy that will eliminate any financial risk. The insurance specialist’s job does not end there, however. They must continue monitoring these risks to determine how they change over time – and make sure you are aptly covered.

If you already have insurance, it is also important to know exactly what your current insurance policy covers. 

Many property and business owners in Cambodia, and around the world, discover that their insurance coverage does not include what they thought it included - but when it is too late. Some are under-insured in Cambodia or are even sold the wrong insurance policy to start with. To avoid this situation you should be asking yourself very basic questions about your exposure across the entire range of possible problems.

And the best place to start is by having one of Realestate.com.kh’s professional insurance contacts analyze your current insurance policies, and assess whether your risks are truly covered. Get a free quote HERE.