Japan's top three insurers see Kumamoto quake payout at $172 million

Reuters News
Posted: May 20, 2016 5:26 AM

TOKYO (Reuters) - Japan's top three property insurers said on Friday the total insurance payout for damage caused by last month's deadly earthquakes in Kumamoto is likely to be around 19 billion yen ($172 million).

The estimate does not include the insurance payout for residential earthquake coverage, which is reinsured by a government-run program designed to provide affordable cover in a quake-prone country.

The bulk of the payout relates to corporate insurance for damaged factory buildings and equipment at the southern manufacturing hub.

Tokio Marine Holdings Inc estimated its payout at around 5 billion yen, while MS&AD Insurance Group Holdings put the cost at 12 billion yen, and Sompo Japan Nipponkoa Holdings at 2 billion yen.

"There are semiconductor factories in the region and we underwrite some of them," MS&AD Senior Executive Officer Nampei Yanagawa told reporters at an earnings briefing.

The first of several earthquakes struck Kumamoto on April 14, damaging houses, causing landslides and halting production at electronics and car parts factories in the area. More than 40 people were killed.

The projected payouts are far less than the combined 220 billion yen the three companies paid for damage caused by the 2011 earthquake and tsunami that hit northeastern part of Japan.

The three companies also paid out 425 billion yen for the 2011 floods in Thailand that hit key industrial areas, severely affecting Japanese manufacturers operating in the country.

The government-run residential earthquake insurance scheme has paid out 1.27 trillion yen for the 2011 earthquake and tsunami disaster, according to the General Insurance Association of Japan.

(Reporting by Taiga Uranaka; Editing by Chang-Ran Kim and Richard Pullin)