Friday, 15 January 2010
Haiti Residents Have Little Insurance Coverage
Haiti, the poorest country in the Western Hemisphere, was rocked by the biggest earthquake it has seen in 200 years this past week. The amount of property damage has yet to be accessed but it is estimated to cost hundreds of millions. The number of deaths is reported to range in the tens of thousands.
With 80 percent of the population under the poverty level, insurance is rarely purchased by Haitian citizens. Haitians spend $20 million on all types of insurance and $10 million comes from auto insurance premiums. That means the vast majority of a country with almost 10 million people have no insurance of any kind.
Haiti will receive funds from the Caribbean Catastrophe Risk Insurance Facility which could pay the Haitian government up to $8 million according to an article, “Caribbean Insurance Pool to Pay Haiti Quake Claim” by BusinessInsurance.com, but it will almost definitely not be enough for this natural disaster. The Haitian government purchased the disaster insurance plan in 2007 for just $385,500 and shares it with other Caribbean countries.
Among the tens of thousands to have died or were injured, very few likely had any health, home, or life insurance. In addition, damage to the water and electrical systems were catastrophic and the total damage will take years to repair.
It will be extremely hard for Haiti to rebuild itself considering the amount of devastation and the lack of insurance coverage. It’s truly an epic tragedy that will strike more than once for far too many.
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