The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian general insurer yesterday said it did not expect Hurricane Sandy “to become a significant loss” event for the property and casualty industry, although it was “not counting our chickens” just yet.

Tom Duff, general manager of Insurance Company of the Bahamas (ICB), the carrier through which BISX-listed J. S. Johnson places much of its insurance business, said the various computer model projections all suggested the Bahamas would experience tropical storm conditions today through Friday.

Suggesting that the “key” was what happened to now-Hurricane Sandy as it moved over eastern Cuba, Mr Duff told Tribune Business: “Presently, I’d be surprised if it’s as windy as it was with Hurricane Irene last year, as far as New Providence is concerned. We encountered winds anywhere up to 70 miles per hour with that storm.”

Still, warning that all storms were capable of causing damage, Mr Duff added that should Sandy cross the Bahamas as a hurricane its exposure in those islands likely to be most impacted was “not too heavy”.

“So it should not be a major incident for ICB and the rest of the companies in the industry,” the ICB general manager told Tribune Business.

“But we’re not counting our chickens, as these things change at short notice. So far, we’re not overly concerned, but we’re keeping a watchful eye on that.

“I’d be surprised if it becomes a significant loss for us, but I’m keeping my fingers crossed.”

As with Hurricane Irene, the total claims payout for the Bahamian property and casualty insurance industry, and their reinsurers, was relatively small because the Family Islands took the brunt of the impact.

Insurance industry gets lower the further you travel from Nassau, as the smaller Family Island populations means there are fewer homes, cars and infrastructure assets to damage.

The majority of the industry’s exposure is concentrated on New Providence and Grand Bahama, and both these islands are forecast to be on the ‘weaker’ western side of Sandy when it moves through the Bahamas. If that holds, the Bahamian insurance industry, too, will be spared the worst.

ICB experienced $13 million in gross claims last year, some $6.7 million resulting from Hurricane Irene and $6.3 million from various fires - including two prominent blazes on Bay Street.

Similarly, fellow property and casualty insurer, Summit Insurance, suffered more than 400 Irene-related claims totalling a gross $6.5 million.