The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian insurer yesterday said its Hurricane Sandy gross losses were likely to come in more than 20 per cent below 2011 levels at “just over $5 million”, acknowledging the storm would have a “dampening impact” on 2012 profits.

Timothy Ingraham, president of Summit Insurance Company, the underwriter through which Insurance Management places most of its property and casualty business, said it had received just over 200 Sandy-related claims.

“It’s looking as if it’ll be less than the Irene losses we suffered,” Mr Ingraham told Tribune Business. “At the moment, our reserves are a bit less than the losses for Irene.”

Summit incurred $6.5 million worth of gross claims/insured losses from Irene in 2011, but Mr Ingraham said the carrier was currently estimating that Sandy-related calls would be around three-quarters of that sum.

“I think we’ll be looking at somewhere just north of $5 million for this one,” he told this newspaper. “Most of it is from Grand Bahama, some from Abaco, and quite a bit of it is flood damage.

“As I recall correctly, we’re somewhere just north of 200 claims this year. It could have been a lot worse.”

Mr Ingraham said “a fair chunk” of the likely $5 million claims payout would come from Summit’s reinsurers, with the Bahamian carrier itself picking up a relatively minor share of the bill.

He added, though, that Sandy would still impact what had looked a promising 2012 in terms of bottom line profits for Summit.

“It will definitely have an impact on us, plus we’ll have to meet any deductible under our catastrophe reinsurance policy, the same way clients have to pay their deductibles on their property and casualty policies with us,” Mr Ingraham explained.

“There will definitely be a hit to the bottom line. It depends on where the numbers settle at, but we expect it to have a dampening impact on what was turning out to be a pretty good year.”

Mr Ingraham added that on top of Hurricane Sandy, Summit had also received several claims relating to traffic fatalities within the last six-seven weeks.

“That will have an impact as well,” he said. “It depends on where we end up, and where the final figures and results are set.

“Last year, we had all our pain in the first quarter of the year, although we did have Irene as well. This year, all the pain has come in the fourth quarter, with the storm, the fire and a couple fatalities.”

Mr Ingraham added that Summit hoped to move into its new head office, the former CLICO branch office on Sears Hill, during the 2013 first quarter.

Other Bahamian property and casualty underwriters appear to have fared slightly better in Sandy, at least compared to 2011 Irene claims.

Tom Duff, general manager at Insurance Company of the Bahamas, the general insurer through which J. S. Johnson places much of its business, told Tribune Business: “Basically, the position is unchanged from last week.

“We’re looking at an overall gross loss no greater than 50 per cent of our Hurricane Irene claims. At the present time, our reported claims are costing us around $2.5 million, and we have 125 claims reported to date.

“Things are tracking as if they’re tapering now, so I don’t think they’ll be to much change from the current reported position.”

Patrick Ward, Bahamas First’s chief executive and president, told Tribune Business last week that Hurricane Sandy would generate $30-$35 million in total insured losses for the Bahamian property and casualty market, with both his company - and the overall industry - looking at sums equivalent to “50-60 per cent” of Irene levels.

“At this point, our feeling is that we’re looking at a loss that will fall in the range of 50-60 per cent of Irene,” Mr Ward told Tribune Business.

“We’re looking at losses in the range of $30-$35 million from an overall market standpoint.”