Asian industrial risks 60 percent underinsured, says Marsh

A report by broker Marsh has found that industrial risks in Asia are underinsured by up to 60 percent, due to companies failing to consider rising commodity, materials and labour costs.

The report identifies telecommunications, energy and petrochemical as three sectors where the problem is particularly prevalent.

“In our experience, the extent of underinsurance in Asia is more widespread than in more developed regions,” says Jason Wells, managing director and leader of specialty practices for Marsh in Asia.

“Last year’s devastating floods in Thailand were a stark reminder of how serious the problem has become. Firms often only become aware when they make a claim and discover the sum insured does not cover the replacement cost. We urge companies to perform regular asset valuation ‘health checks’ – at least once every two to three years – so that the sums insured can be both accurate and adequate.”