ICB: Insurance premium deferment created challenges
As the end of the deferment period for insurance policyholders draws closer, Insurance Commission of The Bahamas (ICB) Superintendent of Insurance Michele Fields said the deferment presented challenges for brokers and agents.
Shortly after declaring a national state of emergency due to the COVID-19 pandemic, Prime Minister Dr. Hubert Minnis suspended the obligation of policyholders to pay any insurance premiums on health, medical and life insurance policies for the duration of the state of public emergency, which ended on June 29, and for 60 days after.
Though the announcement caused some trepidation throughout the industry, stakeholders complied despite some challenges.
“On the life insurance side, some were faced with a challenge given that their system would automatically lapse the policy after certain parameters are in there, once the grace period has passed and no payments have been paid. And so there had to be a lot of manual interventions for them to ensure that the policies didn’t lapse, and so they are managing that situation. I am not certain of the number of policies that entails, but what companies are trying to do is to reach out to their policyholders to have them register to request this extension, so that was a bit of a challenge there,” she told Guardian Business yesterday.
“On the general insurance side, again policyholders were asked to reach out to their company or agent or broker to request this extension and that is happening on a case-by-case basis. So, the industry has complied with the order and that deferment would expire at the end of August, as it was in that first order that ended in June and then two months after that.”
Last week, the ICB in a public notice strongly encouraged policyholders who have deferred payment of insurance premiums to contact their insurance company, since the 60-day extension for premium payment is scheduled to expire on August 31, 2020.
But with tens of thousands still unemployed and the country on lockdown, many Bahamians remain in difficult financial straits.
Asked her advice to policyholders, Fields said, “As a policyholder and a mother also trying to balance a budget, I think that’s a no-brainer.
“You’ve got to eat and you’ve got to have a roof over your head and tend to your children’s needs, et cetera, so everybody has their hierarchy of needs and wants, so I think that is very much a personal decision, but I think you have to put the basic needs first.”
While the government has extended other safety net policies in the wake of a slowed economy and continued lockdowns, it has not made any new announcements regarding a further deferment period extension for insurance policyholders.