The government announced yesterday that from this year its annual insurance scheme for financial losses suffered by local small- and medium-sized enterprises (SMEs) caused by natural disasters will also cover losses resulting from damage during the hoisting of a black rainstorm warning signal, in addition to the hoisting of a No. 8 or above typhoon signal, or a red storm surge warning signal or above.
The extension of the coverage will also cover the government’s scheme of providing a subsidy of up to 30,000 patacas for eligible companies to pay the annual premium of their policy of the insurance scheme.
The government launched the insurance scheme and the subsidy scheme in 2019.
The government has been running the insurance scheme, officially known as Small- and Medium-sized Enterprises Major Disaster Property Insurance, in collaboration with a number of insurance companies.
The insurance scheme is run and overseen by the Macau Monetary Authority (AMCM), while the subsidy scheme is operated by the Economic and Technological Development Bureau (DSEDT) through its Industrial and Commercial Development Fund (FDIC).
Since the launch of the two schemes in 2019, they had hitherto only covered losses resulting from damage during the hoisting of a No. 8 or above typhoon signal, or a red storm surge warning signal or above.
The Macau Monetary Authority and the Economic and Technological Development Bureau announced the extension of the coverage, i.e., the hoisting of a black rainstorm warning signal, in a joint statement yesterday.
For this year’s schemes, according to yesterday’s statement, eligible SMEs can submit their applications from now until December 30.
The statement said that the extension of the coverage will enable the schemes to meet the needs of more SMEs.
A red storm surge warning signal means that the flood level is forecast to reach between 1.5 metres and 2.5 metres above the road surface in the Inner Harbour area.
Macau’s highest storm surge warning is the black warning – when the flooding is expected to exceed 2.5 metres.
The black rainstorm warning signal, the highest one, means that “heavy rain has fallen or is expected to fall over extensive areas, exceeding 80 millimetres in an hour, and is likely to continue”.
The statement underlined that the government rolled out the insurance scheme in 2019 with the aim of solving the then problem in which insurance for financial losses suffered by SMEs in low-lying areas caused by serious typhoons or storm surges was not provided by the local insurance sector.
According to the statement, 55 policies were issued under the insurance scheme between 2019 and last year, and all of the companies were granted a subsidy that covered part of the annual premium of their respective policies.
The Macau Monetary Authority has decided to extend the coverage of the insurance scheme after considering that Macau has been affected by extremely heavy rainstorms over the past few years, which caused flooding in various areas in the city, yesterday’s statement said.
Five insurance companies will participate in this year’s insurance scheme, according to yesterday’s statement.
As in previous years, the insurance scheme and the subsidy scheme this year will cover companies employing up to 100 employees.
Like in previous years, for this year’s insurance scheme there will be three plans for eligible companies to choose from, namely covering losses of 100,000 patacas, 200,000 patacas and 300,000 patacas. The annual premiums of the three plans will be 25 percent of their respective covered amounts – 25,000 patacas, 50,000 patacas and 75,000 patacas, regardless of the locations where the companies’ premises are situated.
As in previous years, this year’s insurance scheme will continue to offer a discount on the premium for companies that renew their policy, provided that they have never claimed on their insurance under the scheme.
According to the statement, those who renew their policy for the first year will enjoy a 20 percent discount, while those who renew their policy for the second and third year will have a 25 percent and a 30 percent discount respectively. Those who renew their policy for the fourth year or above will enjoy a 35 percent discount on the annual premium.
Such as in previous years, for this year the amount of the subsidy will cover 50 percent of the annual premiums of the three plans, but with a maximum of 30,000 patacas.
Therefore, after receiving the subsidy, eligible companies will need to pay 12,500 patacas, 25,000 patacas and 45,000 patacas for the three plans per year respectively.
Image courtesy of SMG
