Taiwan considers insuring infrastructure against natural disasters

Taipei, Sept. 19 (CNA) Taiwan's government is considering taking out insurance on the country's infrastructure, especially airports, highways and railroads, to cover damage caused by natural disasters, according to Minister of the Interior Lee Hong-yuan. Over half of the world's recent major natural disasters took place in Asia but only about 9 percent of the damage in the region has been covered by insurance, he said. In Taiwan, only 3 percent of the damage resulting from natural disasters is covered by insurance, a rate lower than in South Korea and Japan, Lee said. In the aftermath of a devastating earthquake on Sept. 21, 1999, only 4.03 percent of the damage was paid for by insurance companies. After Typhoon Morakot struck Taiwan in 2009, only 1.24 percent, or NT$2.3 billion, of the total estimated damage of NT$185.7 billion (US$6.3 billion), was covered by insurance. Currently, contractors on public infrastructure projects are required to purchase insurance for their work only during construction. Once the work is completed, the highways and bridges become the government's responsibility. Billions would have to be paid in premiums if the country insured its major infrastructure, but it would mean the government would no longer have to allocate special funds to pay for such damage, Lee said. The disaster prevention office under the Executive Yuan has drafted a proposal and will submit it for Cabinet approval after a detailed calculation of the required funds is completed, Lee said. The administration will also need to work with the Legislative Yuan to move the proposal forward, he added. (By Justin Su and Jay Chen)