In light of the coronavirus outbreak several local insurance firms say they are expecting more companies to show an interest in obtaining business interruption insurance coverage in the coming months.
At the same time, those who spoke to Barbados TODAY said they have not seen any major uptick in individuals seeking medical or life insurance coverage as a result of the viral pandemic.
Chief Executive Officer of Massy United Insurance Ltd Randy Graham said: “We haven’t seen a whole lot of change in terms of persons’ appetite for insurance around the COVID-19 in particular.”
And he said he did not anticipate any increase for personal insurance due to the spread of the diseases either.
However, Graham said, “Businesses are contemplating business interruption insurance right now.
“COVID-19 is a pandemic and some policies have a pandemic exclusion, so because they are closing doesn’t mean that they will be able to file a claim. But I think what it has done is to show companies that there are things out cause you to close and when you are closed you have to lay-off staff, you have loss in revenues, and so people are now interested in whether they should buy a business interruption policy that should they close for any particular reason the policy may be able to pay them to allow them to pay staff and fixed invoices,” he explained.
“So we would expect that after this week you would get more companies looking to buy business interruption policies to provide support for themselves in circumstances when they have to close,” said Graham.
Global pandemic insurance coverage is not currently offered in Barbados, and is rare globally.
It was not immediately clear if companies were contemplating offering a global pandemic insurance policy, and President of the General Insurance Association of Barbados Goulbourne Alleyne did not return several calls requesting an interview with Barbados TODAY.
However, Graham said that was an area his company was willing to consider, adding that it was already being looked at in some international markets.
“So if there is a pandemic insurance that is going to come on to the market, we will do all in our power to make sure, if it is at all possible, that it is also able to be purchased by individuals too to give them income where they have lost their employment because of the pandemic and still have to pay their bills,” he said.
The former Financial Services Commission CEO said he hoped all insurance companies would be “flexible” in how they treat to payment of claims and the collection of premiums at this time.
“What the companies will have to do is be flexible in paying claims because people, if they move about can still get involved in accidents, there are still going to be fires and damage to properties, and chances are because people spend their money on food and medication they have not yet paid their insurance premiums in full. So companies will have to be flexible in how they pay claims in that regard,” Graham explained.
He said he did not believe the current situation would result in any significant jump in claims related to the COVID-19 globally to materially impact the reinsurance cost.
General Manager of Brydens Insurance David Alleyne told Barbados TODAY he too, did not see any heightened interest among individuals for health or life coverage at this time, saying they were more interested in staying safe from contracting the virus.
However, he said, “I think people will really review their cover and what they are covered for and I am sure our team will be fielding many questions in the coming weeks or months for cover for what people really never consider before.”
Alleyne said he also anticipated businesses would seek interruption insurance.
“People will seek to have cover against anything which could cause disruption. Business interruption is something which not enough people take seriously. People understand the need to cover themselves against natural perils and hazards like fire and hurricanes but many businesses do not see that there is an attendant loss that is even more dangerous than the actual fire, which is the ongoing cost because it affects cash flow,” said Alleyne, adding that rebuilding often takes time.
“Your business can be interrupted for a variety of reasons as we are seeing now. So yes, there is going to be heightened awareness of the need to protect yourself, both for physical and pecuniary losses,” he said.
Meanwhile, Chief Executive Officer of Sagicor Life Inc. Ravi Rambaran said there were some early signs that more people could be seeking insurance coverage.
“I would say there are certainly positive early signals where people are, those who may not consider insurance, are considering insurance. That is positive because from a country perspective and regional perspective, what we have found is that our people are significantly underinsured in all aspects,” said Rambaran.
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