NASSAU, BAHAMAS — The insurance industry regulator has expressed concern that the risk of underinsurance in this jurisdiction will increase, and access to insurance likely diminish as many reinsurers have not only raised their rates but reduced the amount of capacity offered to this region.
Michelle Fields, the Insurance Commission’s Superintendent of Insurance while addressing the Bahamas Institute of Chartered Accountants (BICA) Accountant’s Week seminar on Tuesday, noted that there has been an increase in insurance premiums over the past two years, particularly as it relates to catastrophic cover. She revealed that the general insurance market in The Bahmad cedes between 60-80 percent of its risks to reinsurers.
“The market has hardened over the past few years, which means that the availability of insurance is decreasing, and the cost is increasing. This has been the trend since the mid-2000s, with COVID-19 arguably being the final thrust,” said Fields.
“Many reinsurers have not only raised their rates but reduced the amount of capacity offered to the region. This is of concern as the risk of underinsurance will increase and the access to insurance is likely to diminish.”
Fields remarked that many reinsurers used by domestic insurance companies are A-rated companies based in Europe, noting that countries like Germany are introducing a punitive tax on companies doing business with countries that have been blacklisted by the EU. Germany plans to introduce such a law in 2025, with Fields noting that it is important for The Bahamas to be removed from the EU blacklist.
People struggling to eat, license/inspect/insure vehicles, pay Bpl with vat + fuel surcharges, etc etc etc. They shouldn’t wonder why people can’t fully ensure.