With the fire ravaging Attica, the importance of household and business insurance against natural disasters is emerging in the most dramatic way in the public debate, while the business community is measuring its wounds with factories going up in flames in Vrilissia, Penteli and Chalandri .
In Greece, although interest in property insurance is rekindled after natural disasters, after days pass it fades, with rates of “fortification” of homes and businesses against natural disasters moving at low levels. The financial narrowness of households and the liquidity… which is not in excess in small and medium-sized enterprises play their role, while the incentives offered for insurance are judged as insufficient by the market.
“1 in 5 small and medium businesses insured, houses worse”
“Already yesterday the phones are ringing from citizens asking to know details about the insurance of their property but this always happens when we have natural disasters, after that the interest fades. Insurance is one of the few services that you can buy when you don’t need it and you can’t buy it when you do. Many insurance companies do not insure property in the days following a natural disaster in the affected areas”, POMIDA’s insurance consultant, Nikos Kehagiaoglou, points out to the “Economic Post”.
“The incentive for a 10% discount to ENFIA that was given last year is not enough to increase home insurance, I estimate that the insurance rate after the discount has increased by around 5-6%, currently around 15-16% of homes are insured in Greece, while small and medium enterprises are insured at a rate of approximately 20%. If the ENFIA discount moves closer to 30%, interest in home insurance will increase,” he notes.
The inconceivable cost of 200 billion euros if we do not act
Climate destabilization leaves an indelible mark on economic activity with costs approaching 200 billion euros by 2100 for the Greek economy, according to the results of a study prepared by the Climate Change Impact Study Committee of the Bank of Greece.
With climate change “costing” 2.2 billion euros per year to the Greek economy, approximately 1% of GDP in today’s values, it becomes clear that immediate measures to limit carbon dioxide emissions become imperative in order to mitigate the effects of climate Armageddon on an economic and social level.
“Give more incentives for business and household insurance”
In this context, the reduction of taxation and the removal of disincentives, in order to strengthen the contribution of private insurance to society, have been put on the dialogue table with the government by the insurers.
The Union of Insurance Companies of Greece has pointed out that in order to expand the insurance base, the VAT on health insurance should be reduced and the 15% tax imposed on insurance premiums should be abolished.
In addition, the Union has asked the government to reduce the threshold of 2 million euros, annual turnover, to 1 million euros, for the mandatory insurance of businesses against natural disasters, as well as to increase the 10% discount in ENFIA for insured homes against climate risks.
SMEs are hesitant, manufacturing more willing for insurance
The reluctance of small and medium-sized enterprises to insure against natural disasters is also demonstrated by a survey of the Thessaloniki Chamber of Commerce. Four out of ten artisans have insured the assets of their business, while only 4.8% consider natural disasters (floods, fires, etc.) as the most important threat to a business.
More specifically, to the question “have you insured your business assets?” 62% answer no, while 38%.
Manufacturing companies appear to be more “suspicious” about insurance as 47.4% answer positively to the question of whether they have insured their company’s assets, while 42.6% answer negatively. In mixed enterprises, the percentage of positive responses reaches 46%, while the percentage of negative responses reaches 54%. The least insured businesses are those in the service category. Only 10% of them have been insured.
Which companies are compulsorily insured?
It is recalled that businesses with annual gross revenues, during the previous fiscal year, of more than 2,000,000 euros are compulsorily insured against fire from natural causes, flood and earthquake.
When is the ENFIA reduced by 10% for residences
It is worth noting that for the granting of the 10% discount to ENFIA for residences, the previous year requires:
a) The residence must be insured with an insurance company that is registered in the Register of Insurance Companies maintained by the Private Insurance Supervision Directorate of the Bank of Greece,
b) The insurance must cumulatively cover the insured risks of earthquake, fire and flood for a period of at least three months within the same year,
c) The capital insured for all three risks of the previous subsection to cover the total value of the reconstruction of the building or buildings that make up the residence. For the calculation of the reconstruction value, the total area of the main and auxiliary areas of the residence is taken into account,
The reconstruction value of the residence is set at 1,000 euros per square meter. Especially for 2024 the reconstruction value of the residence is set at 900 euros per square meter.
The period of three months is also considered completed when the residence is insured with one or more insurance policies with the same or with a different insurance company with a total insurance duration of at least 90 days within the same year.
In the event that changes are made to the insurance policy during the year in terms of the insured value of the residence and/or in terms of the type of earthquake, fire and flood risks covered, only the period of insurance for which the conditions are met is taken into account of the previous paragraphs.
SOURCE: ot.gr
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