Importance Of Insurance For Expats

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By John Shakespear for B2B Cambodia

Insurance companies in Cambodia earned $36 million in premiums in 2012.

This figure, while still the lowest in Southeast Asia, represents a 21% increase in revenue for the industry.  The past year has also seen the arrival of the first three life insurance companies to Phnom Penh.

David Treal, owner of AG Cambodia, recommends three main types of insurance for any foreigner living in Cambodia: “property insurance, vehicle insurance, and health insurance for hospital and evacuation.”

Properties can be insured up to the cost of construction by owners or renters, and Treal recommends “taking out property insurance if you’re renting, unless it’s written in your lease agreement that you are not responsible for damages to the house.”

David Carter, CEO at Infinity Insurance, points out that “those documents are typically very small, not clear about the liability for damage to the building,” so it’s advisable to take documents to an insurance provider or agent who can interpret them and suggest an appropriate policy to minimize liability.

Although Cambodia’s Insurance Law is currently under revision, vehicle insurance is not presently required by law in Cambodia, and this makes it extra important for expatriates to have it.  Accidents are common, and foreigners are likely to be held responsible in most cases.

Health insurance packages for individuals, families, and staff generally fall into two categories, Treal explains: “hospitalization only and hospitalization including outpatient.”

Almost all policies sold to expatriates cover medical evacuation to Bangkok or Singapore, with limits ranging from $500,000 to $1,000,000, depending on the benefits.

When choosing corporate healthcare packages for employees, Treal says, “it depends if its expat staff or local staff.”  While companies tend to insure foreign staff with foreign providers, Khmer staff are usually covered by local companies.

Limits can be as low as ten thousand dollars, as most policies for locals do not cover MedEvac.  Accordingly, Treal explains, “the range of premium is about tenfold—in the range of $100 or a few hundred for local cover and in the range of $1000 or more for expat staff.”

Insurance is gaining momentum in Cambodia.  In addition to the new life insurance companies, says Carter, “microinsurance is something that is being formalized now that will come in the next years.”

He also predicts the arrival of additional intermediaries into what is now largely a direct market.