Earthquake Insurance Claims Top Nu 5.34 Million as Homeowners Seek Greater Protection

The Bhutan Insurance Limited (BIL) has received 134 earthquake-related insurance claims worth an estimated Nu 5.34 million following the June 7 earthquake, highlighting both the financial impact of the disaster and growing public awareness of the importance of property insurance.

As of June 26, the claims submitted to the insurer had a combined estimated value of Nu 5,340,108, with Punakha Dzongkhag recording the highest number of claims at 28.

The largest individual claim was reported from Haa Dzongkhag, where a traditional Bhutanese load-bearing house sustained severe structural damage. The claim is estimated at around Nu 1.6 million and could qualify as a total loss, subject to the outcome of a detailed engineering assessment.

According to BIL, the most commonly reported damages include major cracks in walls, structural failures, damage to load-bearing elements, and other earthquake-related defects, particularly in traditional buildings.

The majority of reported damages occurred in rural areas.

BIL recorded damage to 73 rural properties, with estimated losses amounting to Nu 3.09 million. The affected locations include Jisthephu, Tshebji and Naja in Paro, Punakha, and parts of Trashigang.

In comparison, 24 urban properties suffered damage worth Nu 1.81 million, with claims coming from Taba, Jungshina and Babesa in Thimphu, as well as Wangdue, Punakha, Phuentsholing and Gelephu.

BIL said it has mobilised engineering teams across the country to assess reported damages. Claims are allocated among engineers based on location and workload, while high-value or technically complex cases undergo additional verification by the company’s head office engineering team. Independent loss surveyors are also appointed where necessary.

During inspections, engineers conduct site visits, document damages through photographs, jointly measure affected structures with property owners, prepare repair estimates using the Bhutan Schedule of Rates (BSR) 2026, and submit detailed assessment reports for technical verification before claims are processed.

As of June 26, approximately 70 percent of all earthquake-related claims had been assessed and technically verified.

So far, 10 claims have been approved for settlement, while about 37 policyholders withdrew their claims, mainly because the assessed damage was minor or the payable amount was considered too small to pursue.

Although no compensation had been disbursed as of June 26, BIL said it is finalising payment procedures to ensure settlements are carried out in a transparent, systematic and financially prudent manner.

Once a claim is approved and forwarded to the Accounts Department, payment is typically processed within one to two working days.

The insurer said the claims process has faced several operational challenges, including the sudden influx of claims, difficult access to remote areas due to damaged roads, and the technical complexity of distinguishing pre-existing structural defects from earthquake-induced damage.

Engineers also reported extensive damage in traditional load-bearing buildings, requiring detailed structural assessments. Scheduling inspections has also proven challenging where property owners are unavailable or buildings are occupied by tenants.

BIL said the earthquake has significantly increased public interest in property and disaster insurance, with many homeowners seeking information on earthquake coverage following the disaster.

The company is encouraging property owners to ensure their homes are insured at current replacement values, understand the scope of earthquake coverage under their policies, promptly report damages, avoid major repairs before inspections (except emergency work), and maintain photographs, ownership documents and maintenance records to facilitate claims processing.

The insurer also advises homeowners to maintain their buildings properly and strengthen older structures in line with safe construction practices to improve resilience against future earthquakes.

The rise in claims and public inquiries underscores the growing recognition of insurance as an important financial risk management tool in Bhutan, particularly as climate- and disaster-related risks continue to pose increasing economic challenges for households and businesses.

Sangay Rabten, Thimphu

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