Inquiries on property insurance by those who were uninsured before they were affected by Hurricane Dorian have increased, president of Summit Insurance Company Timothy Ingraham told Guardian Business yesterday, explaining that reinsurance costs have increased by 15 percent or more.
Ingraham added that home and business owners who may not have been affected by Dorian could see their premiums increase because of the risk storms like Dorian are now expected to pose to The Bahamas.
“We’re seeing reinsurance increase anywhere from 15 percent and up, depending on what area you are looking at,” Ingraham said.
“Even persons who have not been affected, because of the scale of the loss, will see some impact on their rates as we go forward. The exact extent of that is difficult to put your finger on.”
According to Ingraham, insurance companies are working “to get the losses resolved as quickly as possible”.
While insurance costs will inevitably increase, Ingraham said owners will likely still look to insure their properties against the devastating effect of strong hurricanes.
“I’ve always found that in areas which have been seriously impacted, people are more inclined to renew their insurance because they have seen the value of it,” he said.
He explained that after Hurricane Andrew in 1992, insurance companies had a similar experience.
“The people who were impacted in Andrew were much more vigilant and diligent about making sure that their insurance was renewed, because they had seen the impact,” Ingraham said.
“I expect the same would happen with certain areas of Grand Bahama that have kind of gotten used to storms, they’ve had quite a few storms in the last few years.”
Ingraham said witnessing entire buildings blow down is likely to have an affect on people’s want and need to insure their properties.
He added that people who are receiving insurance payouts are likely to use the money to rebuild their structures stronger than before.
He said the general feeling in The Bahamas is that its building codes are adequate, just not as strictly adhered to as it should be.
“Hopefully people will make sure the building code is adhered to, pay more attention to that and understand that if you take a short cut to save a couple dollars now, it’s probably going to cost you a lot more in the long run if and when the loss happens,” Ingraham said.