The island’s leading advocate for consumer rights is appealing to the authorities to give Barbadian workers a pay rise before insurance companies increase their premiums.
Director General of the Barbados Consumer Research Organization (BarCRO) Reverend Malcolm Gibbs-Taitt said this would be the only sensible thing to do.
President of the General Insurance Association of Barbados (GIAB) Michael Holder last week revealed that the cost of insurance coverage would increase by between ten and 25 per cent, and in some cases by as high as 30 per cent, effective January 1, 2018.
However, Gibbs-Taitt said it would be nothing short of pure stupidity for insurance companies to increase rates so drastically in the absence of pay rises for workers.
“I feel that the increase should only come after persons are given a wage and salary increase. To do an increase at this time is asinine. I am of the view that people do not have money to deal with any increase whatsoever,” he told Barbados TODAY.
“The people of the country are struggling to survive, so I don’t know why the increase is coming at this time.”
The BarCRO head complained that as it currently stands, Barbadians had enough economic troubles to contend with.
As a result, he said, the timing of the hike would hurt them even further.
“I think it will have a big impact on people’s lives if people cannot afford to pay it. And you have to understand that type of deduction or reduction is made from their salaries. So they don’t really see that money at all. It is taken from them before pay day. So I think it is a ridiculous situation at this stage in persons’ lives.
“People need to be paid for the work they do. At the moment we have people working in jobs where they are treated like slaves and that needs to stop,” he argued.
The insurance companies have blamed the planned increase on hurricanes Irma and Maria, which devastated several countries in the northern Caribbean.
In fact, insurance sources said premiums in those areas could skyrocket by between 75 and 150 per cent.
Insurers have also said other recent natural disasters, including Hurricane Harvey, which struck the United States, and September’s earthquakes in Mexico, had left reinsurers scrambling to recoup losses estimated at over US$100 billion.
“These are reinsurers, not only for those territories that were impacted, but also reinsurers for territories not impacted . . . like a Barbados, like a Grenada, like a St Lucia. What the reinsurers have indicated is that there will be a level of property rates increase. The extent of that is still to be determined,” Holder said last week, adding that costs which were traditionally absorbed by the insurers, now had to be passed on to clients.
However, Gibbs-Taitt was not buying this explanation, arguing the planned increase was nothing short of another means of taxing Barbadians.
“I see it as another form of taxing. To me, we have become a tax society and that needs to change. We need to put money in people’s pockets. Unfortunately the Government doesn’t seem to appreciate that they would do better if they tax people less,” he insisted.
“They tend to think, ‘let us grab what we want from people’ because it gives them the power to use people’s money. But if you are not using people’s money in a sensible way it really doesn’t matter. It is just another intrusion on people’s lives and it needs to be stop.
“It really doesn’t matter how soon or late it is. What I’m saying is more money is needed for people, adequate salary before deductions are made to Barbadians. It is as simple as that. People are struggling to make ends meet.”
In fact, the consumer rights advocate went as far as to call on the trade unions to step in and take action to try to stop the rise in premiums, emphasizing the point that Barbadians could not afford additional payments.
“I honestly do not understand how any persons can think that people can bear another deduction from their salary. It is unreal to me. It makes no sense . . . . The trade union movement needs to stand up against this.”
Gibbs-Taitt was also dismissive of the insurance executive’s argument that natural disasters around the region were to blame for the sudden premium hike, saying he failed “to see the link”.
“There is one thing I know. People are not capable of paying that amount because they salaries are too low,” he stressed.