Kathmandu. The damage caused to insured property by the mob riots during the Genji movement against misgovernance and corruption in Nepal is expected to increase exponentially.
This is the estimate of the international credit rating agency AM Best. “The damage to insured property caused by the recent Genji agitation in Nepal could significantly increase the damage caused to insured property,” AM Best said. ’
While most of the damaged property is likely uninsured, the risks of rioting, strike, malicious damage, vandalism and terrorism (RSMDST) are generally covered under the insurance policy extension, AM Best said. “The damage report of the insured property prepared by the Nepal Insurance Authority can be compared with that of the 2015 earthquake,” AM Best said.
Susan Tan, senior financial analyst at AM Best, said the large proportion of damage from mass mob riots highlights the potential for income and capital impacts in the market. “Especially if insurance claims are going up,” he said.
Domestic reinsurers in Nepal are also facing capital pressures, according to AM Best. “Retrocession may provide some relief, but the high perception of RSMDST risk could still weaken capital buffers and limit resilience to further shocks,” Ambest said.
