Standard & Poor's Rating Services said Tuesday recent data on insurance claims in connection with the outbreak of severe acute respiratory syndrome (SARS) will have no immediate impact on its ratings of insurance companies in Hong Kong.
According to a survey of 40 domestic insurers conducted by the Hong Kong Federation of Insurers, 105.3 million Hong Kong dollars (13.5 million US dollars) had been paid in respect of 492 SARS-related claims as of the end of May.
Of these claims, individual life insurance accounted for 93.7 million HK dollars (12 million US dollars), group life insurance 7.7 million HK dollars (987,170 US dollars), and medical and travel insurance 3.9 million HK dollars (500,000 US dollars).
Standard & Poor's believes that the payments made so far will have no material impact on its ratings on insurance companies in Hong Kong. It noted that further claims may be made by holders of insurance policies of types other than those mentioned, but added that it does not expect SARS-related claims in respect of life insurance policies to rise significantly above the amounts reported so far after the death toll as a result of the SARS outbreak stabilized just over a month ago.
As on July 13, 2003, the reported total death toll stood at 298out of the 1,755 patients officially confirmed as having contracted the illness since the beginning of the outbreak.
The extent of prospective claims in respect of non-life insurance policies is not clear. Market speculation has pointed tothe possibility that a small number of policies may ultimately generate claims for large amounts.
Such policies include the employer liability insurance policiesfor health workers, business interruption insurance policies with clauses on epidemic coverage for hotels and cancellation cover forconcerts. Such claims are, however, likely to be restricted to a limited number of non-life insurers and reinsurers, while the development of claims remains uncertain, Standard & Poor's is closely monitoring the possible effect on the companies concerned.
(Xinhua News Agency July 16, 2003)
