Insurers sigh with relief
BY JULIAN RICHARDSON Assistant Business Co-ordinator firstname.lastname@example.org
HURRICANE Sandy devastated Jamaica's eastern parishes, but the island's insurance industry expects losses from the storm to be minimal.
A week after the category one hurricane hit the country, general insurers say claims have only trickled in.
Jamaica's largest property insurer, American Home Assurance Company, said so far it has received less than 10 claims, the majority of them residential.
"All of them have been assessed and we are in the midst of completing the claims," said Mayco Villafana, the company's external communications manager for Latin America and the Caribbean. "Most of the damages are external, mostly roof damage."
Insurance Company of the West Indies (ICWI) has only had three claims to date, said its CEO and president, Paul Lalor.
"So far, it's only a handful," said Lalor. "A couple of property claims and one motor claim, but nothing to write home about."
Andrew Levy, managing director at Jamaica International Insurance Company (JIIC), believes the insurance industry was fortunate.
Downed utility poles, fallen trees, flooded homes, and destroyed crops painted a picture of the fury Hurricane Sandy unleashed on St Thomas and Portland when it hit Jamaica last Wednesday.
But the worst of the storm missed the Corporate Area, where most of the insured properties are, he said.
"It could have been a lot worse. The eye went a little bit east of Kingston and the really heavy winds were east of the eye, so that was not good for St Thomas and Portland," he said.
"But the heavily populated areas of Kingston and St Andrew, and Portmore and the environs there, missed the full strength of the storm," said Levy, who revealed that JIIC has to date received fewer than a dozen claims for hurricane damage.
While there were billions of dollars in estimated losses to crops and infrastructure, neither is heavily insured, he said.
JN General Insurance Company (JNGIC) has taken a proactive approach to settling claims from the storm, calling its home-owning customers and dispatching catastrophe claim teams to those who have suffered any damage.
Based on the claims the company has dealt with so far, JNGIC General Mmanager Chris Hind said he doesn't think the losses will be anything that the insurance industry can't cope with.
"Because we have been actively seeking out claims, we have seen a few more," he said. "But I would agree that in terms of insurance claims, the early signs are that there will be some. I don't think it will be like a Hurricane Gilbert."
The expense of insurance combined with a perceived rarity of major disasters contribute to a weak appetite for property insurance among locals.
The relatively low take-up of coverage on properties is partly reflected in the low number of claims, said Hind.
"Many of the people who suffer worst don't actually have insurance coverage and that is an issue," he said.
After moving through the Caribbean, where it left 58 persons dead, Hurricane Sandy took aim at the United States east coast yesterday, with sheets of rain and wind gusts of more than 90 mph.
Preliminary estimates are that damage will range between US$10 billion ($900 billion) and US$20 billion in America, which would make Sandy among the 10 most costly hurricanes in the county's history.
But despite the heavy damage in the US, JIIC's Levy does not expect the cost of the storm there to be reflected much in reinsurance rates for Jamaican firms — Insurance companies purchase reinsurance to diversify their risk exposure.
"I don't think its going to change anything too much," Levy said. "It has been fairly catastrophe-free for little over a year and usually you find that one storm doesn't really affect the market too much."