As a country, we set strategic priorities that are not simply based on immediate needs but the potential long-term demands of the population.
Decisions of this type are represented, for example, in our determination as a country that we should pursue a carbon-neutral economy by the year 2030. That national ideal is proving costly in the initial stages as institutions, businesses and individuals seek to build out their capacity to generate energy from renewable sources.
That initial outlay may appear prohibitive and even unnecessary as the price of fossil fuels is relatively low at this time. But we know of the devastating impact of carbon emissions on the environment and geo-political incidents and even natural disasters can result in spikes in the price of oil.
Our Government has declared through the Barbados National Energy Policy (BNEP) that there will be reliable, safe, affordable, sustainable, modern and climate-friendly energy services to all residents and visitors; that there will be zero domestic consumption of fossil fuels economy wide; and that the country will export all hydrocarbons it produces from both on and offshore sources. We have also committed to “democratization of energy” and to create a regional centre of excellence in renewable energy research and development.
We could have been satisfied with the idea that energy prices have been relatively stable for the past three years and centred our future development on a low-cost energy environment, given the status quo.
But we know these things can turn on a dime. Most important, we recognise that carbon emissions are contributing to global warming, which in turn, has a tremendously negative impact on small island developing states like ours. It comes also in the form of stronger, larger, and more destructive storms during the annual Atlantic Hurricane season.
In this context, it was most discouraging to read that only about 30 per cent of this island’s housing stock is insured against the usual risks that can impact us such as fire, hurricane, flooding, and earthquakes.
And as a way of responding to this most recent weather event, President of the General Insurance Association of Barbados (GIAB) Randy Graham has called on Government and the private sector to mobilise their resources and add their collective weight to ensuring a greater level of homeowner coverage by Barbadians.
Graham’s suggestion of a national insurance plan modelled on the Caribbean Catastrophe Risk Insurance Fund, is a worthwhile recommendation that the administration should pursue.
Having expended more than $22 million on the ashfall clean-up from the La Soufriere volcanic eruptions in St Vincent and the Grenadines; hundreds of millions in support to the tourism sector in response to the COVID-19 pandemic; the ongoing health and social care responses resulting from the pandemic, leave us with little for other services.
The point is that the risks associated with the hurricane season from June to November each year, cannot be avoided. And the damage caused by Category One Hurricane Elsa, demonstrates how vulnerable we are to widespread loss to our significantly fragile housing stock.
Of his idea for the creation of an insurance risk pool, Graham said: “It makes some form of cover for hurricanes or earthquakes or even fire, available for the masses of the population at a reduced cost.
“In the first instance, we can ask international funding agencies to help fund the cost of the setup and even the premiums in the first couple of years, and as households get it and see it in use, they can then take on the cost of it going forward. I think that is something that can definitely work and that would give us a chance of getting more houses insured in Barbados.”
Though there are sceptics even within the insurance industry for such an approach, calling it idealistic, we consider the initiative an option worth exploring.
We as a nation, cannot rest comfortably at night knowing that nearly three-quarters of homes and contents are not covered by insurance against the many risks that exist.
Yes, chattel houses by their nature pose a greater chance of destruction than concrete structures, but these Barbadians cannot be left to fend for themselves if there is a national disaster.
We suggest that it is better to minimize the risk and provide universal coverage to homeowners now, than seeking to spend hundreds of millions of dollars to respond after a disaster has occurred.
There is merit also in the suggestion that Barbadians seek to move away from chattel houses to more permanent concrete structures. To do so, one would have to address the matter of land ownership and property rights.
Furthermore, one has to accept the fact that there is a growing number of poor people in this country who cannot afford the costs associated with constructing a concrete home.
In the circumstances, Government has to determine whether this initiative espoused by Mr Graham is a social investment that is worth the expenditure.
