NASSAU, BAHAMAS — A major Bahamian insurer has revealed that the severe weather and “unprecedented levels of rainfall” that impacted New Providence back in the months of May and June resulted in just over four dozen claims and a combined gross loss of $1.6 million for the company.
Patrick Ward, Group president and chief executive of the BISX-listed Bahamas First Holdings commented on the company’s unaudited financial results for the six months ended June 30.
“The first six months of the year were characterized by severe weather events across the globe, with unusual heatwaves, significant flooding, and severe convective storms accounting for the majority of the cumulative economic and insured losses that resulted from these various events,” he said.
“In The Bahamas, during the months of May and June, we experienced unprecedented levels of rainfall – over twelve inches for one event – in the north and western sections of New Providence and in parts of Grand Bahama to a lesser extent. These flooding events and accompanying severe lightning activity caused damage both to vehicles and other property and, as a consequence, we recorded 49 claims with a combined gross loss of $1.6 million.”
Ward noted however that the company does not foresee that this figure will grow in the coming months and that the net impact, after reinsurance recoveries, is not expected to be material to the company’s results.
“Fortunately, the Cayman Islands did not experience any such severe weather activity. These unusual events are a stark reminder of the consequences of climate change, and they are occurring against a backdrop of macroeconomic deterioration in the global marketplace,” Ward said.
Ward noted that the Russian and Ukrainian war has helped to drive inflation “to heights not observed in decades”.
He said: “The cost burden associated with the rise in pricing on a broad range of goods and services is already working its way into the costs of claims across the Group, particularly on the Motor Account. The cost per claim, compared to prior periods, is steadily creeping upward and we anticipate that the majority of this adverse impact will be confined to the Motor portfolio in the absence of a major hurricane or catastrophe loss.”
The company recorded gross premiums of $94.4 million, compared to $90.0 in 2021, an increase of five percent.
“Coincident with the growth in business, net claims incurred increased during the second quarter in both the P&C and Health segments of our business when compared to the same period last year,” said Ward.
“Despite this fact, we were able to achieve net underwriting income $14.1 million at the midyear point, which compares favorably to the prior year result of $13.9 million. A more pleasing development during the quarter was the reversal of the unrealized losses on our main equity investment, which saw the Q1-2022 unrealized loss of $1.2 million revert to an unrealized gain of $1.3 million.
Ward added: “Unfortunately, the unrealized losses on our combined available for sale investments expanded in Q2-2022 to $1.3 million, a reflection of the volatile global market conditions. The Group’s comprehensive income for the midyear point is $0.9 million, which puts us well ahead of the prior year and on track for a respectable full-year outcome.”
Loading ...
