GIAB head says boat owners without insurance will need help

Despite Beryl’s impact on the fishing industry, with scores of boats either sunk or damaged, the insurance industry’s chief spokesman does not believe the foreseeable claims will have a major impact on insurance. 

According to President of the General Insurance Association of Barbados (GIAB) Randy Graham, many boat owners have insurance and will be taken care of, following Hurricane Beryl’s devastating blow to their livelihoods

“There are lots of vessels that have insurance cover on them,” he told Barbados TODAY. “The ones that have insurance policies, it won’t be a problem. The policies will trigger, and those that have coverage will be taken care of by the insurance companies.” 

However, he expressed concern for those without insurance, highlighting the need for community and governmental support. 

“But I think the unfortunate circumstance is that we understand, at least so far, that a number of the boats that have been damaged don’t carry insurance cover. So I think those are the ones that we have to figure out how to help those families,” Graham said.

He noted that while boat owners try to secure their vessels when bad weather is approaching, Barbados does not have the infrastructure to stow the entire fleet.

Graham warned that the country has been “extremely lucky” to avoid significant damage from recent storms, despite their increasing frequency and intensity. And he appeared open to discussing with the government a programme to provide low-cost basic insurance coverage for homes that ordinarily don’t qualify for insurance.

He told Barbados TODAY that storms are getting “bigger” and “more intense”, as well as coming closer to the island. 

Though noting that recent storms caused minimal structural damage due to winds not reaching hurricane force, Graham emphasised the urgent need for more robust insurance coverage among residents.

He acknowledged the economic pressures that lead some to forgo coverage but warned of the risks. 

“The scary thing is that when you get things like Beryls approaching and people realise, ‘oh, if this thing damages my house, I have no savings, no access to loans, and I have no way to rebuild because I don’t have an insurance policy’, that’s when they realise the value of insurance,” the GIAB boss said.

“We have to find ways to get people to understand that the value of insurance is far beyond what we have to pay, but there’s the peace of mind that if something happens, I can rebuild my house tomorrow and me and my family can be safe,” Graham said.

He added that insurance companies are working to make policies more accessible, offering payment plans to increase affordability. However, Graham noted that a shift in mentality is needed to prioritise the “peace of mind cost” that insurance provides. 

Regarding a long-mooted suggestion of chattel insurance, a concept designed to offer basic coverage for properties that might not otherwise be insured such as many timber homes, he suggested the industry would be willing to sit down with the government to work out its implementation. 

Graham said: “I think it’s still a very good idea. I think having every property and every household in Barbados covered at some basic minimum level, even if you want to save $50 000 against a hurricane, would give at least every property a start. But the concept of the idea is still a very good one.

“We have to figure out the administration logistics. How do we get all the properties surveyed and put on a list? And then, obviously, the next big thing is how we fund it. How do we figure out a private-public relationship to help pay for the costs?” 

Despite these hurdles, Graham was optimistic about a basic coverage programme: “The cost of such a programme will be far less than if you had to look for government funding to help rebuild the property in Barbados. So it’s still something that we have to discuss. The sector will be happy to come to your table with any government officials to discuss how we can put that in place.”

In his capacity as CEO of CG United Insurance Ltd, Graham gave an assurance that his firm is well-prepared to handle claims from recent weather events affecting the region. He cited the company’s experience in managing major hurricanes, including Irma and Maria, when they disbursed around $500 million in claims.

“We’ve already deployed teams to St Vincent to assist our clients, and we anticipate a smooth process,” he said. He acknowledged the emotional toll of witnessing devastation in affected countries but assured that from a corporate standpoint, firms are “equipped and ready to manage the aftermath”.

Looking ahead, Graham cautioned that it was too early to predict the impact on insurance premiums following this hurricane season. However, he highlighted the increasing frequency and intensity of hurricanes as a growing concern for the industry. 

“We’ve seen a pattern of gaps between major hurricanes closing, and [Monday’s] events are a continuation of that trend,” the insurance executive explained. (RG)