Companies in Singapore can now buy insurance to make up for losses on hazy days.
The 2015 haze incident – considered one of the worst cases of haze in the past decade – cost Singapore US$9 million (S$12.4 million) in lost businesses, according to insurer Swiss Re Corporate Solutions.
Transboundary haze in Singapore is caused by the burning of peat forests in neighbouring Indonesia.
Businesses like hawker stalls and theme parks saw few customers, and outdoor events like marathons were cancelled. Construction projects were temporarily halted, flights were diverted from the airport due to poor visibility, and tourists avoided visiting.
Swiss Re said it is offering its haze insurance because clients expressed interest.
The haze insurance will pay out in two situations: when the NEA’s PSI index exceeds 200, or if it stays above PSI 100 for 20 days.
Companies that want to reduce the number of minimum days can do so for a price.
The insurance is currently only available in Singapore because transboundary haze is a “local phenomenon”, according to Swiss Re Corporate Solutions’ Southeast Asia head, Didier Bélot.
He added the company might make it available in other countries in the future.