Heavy rain-linked stocks display increased volatility
Workers take a look at a section of road damaged by heavy rain in Seoul overnight, Friday. Yonhap
Insurers in emergency mode as more vehicles expected to suffer flood damage
By Lee Min-hyung
Stocks linked with torrential rain are displaying increased volatility, as the onset of the summer monsoon season began to cause damage across the nation.
Shares of Coway are on a path for solid recovery on growing demand for dehumidifiers and air conditioners. The company's stock price fell to 42,550 won at the end of June, the lowest level so far this year, but is showing signs of bouncing back. Coway shares closed up 2.13 percent at 45,650 won, Friday.
Other dehumidifier manufacturers, such as Winix, have also seen their share prices recover recently when torrential rainfall boosted humidity levels. Winix's stock price hit this month's low of 10,500 won on July 7, but achieved a rebound of around 10 percent until the last trading day this week.
Insurance firms have shifted to emergency mode, as more damage is forecast to be reported during the summer rainy season. According to the insurance industry, major non-life insurers have received flood damage reports involving 437 automobiles between June 27 and July 13, and their combined damage is worth around 4 billion won during the same period. More than 80 vehicles were also flooded in just two days from July 12 when most regions of the country were hit by heavy rain.
Insurance firms will operate their own emergency response teams during the monsoon season by increasing staff and mobilizing emergency vehicles.
Some insurance firms have said that they will start offering vehicle inspection services for their customers.
AXA General Insurance said it will run a special auto inspection service for free between July 13 and August 31. Any AXA customer can take advantage of the service that focuses on checking automobile safety systems particularly in the rain.
Other insurers are also stepping up emergency response measures by informing customers to stay vigilant during times of heavy rainfall.
KB Insurance will operate an emergency office if the number of customers' insurance applications soars due to the torrential rain. Samsung Fire & Marine Insurance is also operating a similar emergency team to provide swift responses in preparation for emergencies. Under the scenario, the company plans to move customers' vehicles to safer places by collaborating with the government.
“Customers are forecast to suffer heavier damage this season due to the unprecedented climate change,” an official from the industry said. “They are advised to take extra caution when driving in the rain.”