Authors : Pramono Sidi, Mustafa Mamat, Sukono and Sudradjat Supian
Abstract: The impact of the financial economics of damage to buildings caused by natural disasters flooding from year to year has been increasing. Thus, the role of insurance companies is one of the important things and periodically they evaluate the large proportion of the premiums charged to insurance participants. In this study, the model calculation and evaluation of insurance premiums as the main component in flood risk management was analyzed. The analysis begins with determining the annual average of the compensation index, calculate the premium per unit of insurance on the basis of parameters of disparate and then determine the proportion of premiums, reserves as well as reinsurance in order to meet payment of the amount of the claims when losses houses damaged by the floods occurred. The case study was carried out on the flood disaster in the Citarum watershed in Southern Bandung, Indonesia. The analysis showed that the greater the initial backup along with an increase in quotas on reinsurance during the period before the disaster and the increase in the value of premiums, all of these strategies can form a scheme whereby the insurance company to cover the financial losses caused by floods.
Pramono Sidi, Mustafa Mamat, Sukono and Sudradjat Supian, 2017. Evaluation Model for Risk Insurance Premiums of Building Damage Caused by Flood: Case Study in Citarum Watershed, Southern Bandung, Indonesia. Journal of Engineering and Applied Sciences, 12: 4420-4425.