Road fatalities cost insurance companies millions
The recent tragic accident at Two Mile Hill, St Michael did not only cost the lives of four young women and left a fifth clinging to life at the Queen Elizabeth Hospital (QEH), but could also cost the insurance companies several million dollars, one insurance executive has said.
And the president of the General Insurance Association of Barbados (GIAB) Davis Browne has warned that unless motorists begin to heed safety messages premiums would rise.
Browne complained that the frequent deaths and serious injuries from accidents put a massive dent in the insurance companies’ coffers andcontended that a number of these going to be full recovery? So it is still a particularly with those which are with accidents could be avoided if drivers heeded safety messages.
He disclosed that preliminary “conservative” estimates of death claims from the four young women who perished in the October 25 car crash stood at $2 million and could exceed $7 million when the fifth accident victim’s injuries are taken into consideration.
However, the insurance executive insisted that before a final value is placed on the claims it must first be determined if 23-year-old Nakisha Shepherd will fully recover or suffer a life-long disability.
“The recent ones in terms of fatalities and so forth they are not going to be finalized for a little while because you have to go through autopsy, medical reports, all those things before you can come to a final position. Usually they will take at least a year, year-and-a-half for the claimants to get the documentation and so on, together . . . and the one who is injured that is not going to be quantified for a little while because we need to know what is the expectation in terms of recovery and so forth . . . is it going to be residual disability, or is it bit early for that…but that is going be a significant claim as well,” Browne told Barbados TODAY.
“But I would say . . . that could go anywhere up to $7 million. [It] all depends what happens with her; if she is crippled, it could be a high claim,” he said.
The GIAB head said the estimated minimum claim for the two women who died in a road accident in St Philip on August 31 was $700,000, explaining that the value of a claim for road deaths tended to be lower than accidents that resulted in lifetime disabilities. He attributed this to the continuing medical upkeep, coupled with loss of earnings.
Browne said the industry was “pretty concerned” about the number of serious and fatal accidents and was worried about the lack of relevant information.
“Is it inattention on the road, is it drunk driving, is it that people are texting and driving? What kind of road craft is being exercised out there?”
“Certainly the impact on the industry is pretty heavy because we are talking multi-million dollar claims in some cases, serious injuries and the multiple deaths. And that will have its impact on the industry,” he cautioned.
The association president explained that with more than 100,000 vehicles on the roads here, “just one accident can wipe out significant premiums.”
He said road safety campaigns encouraging responsible driving and discouraging drinking or texting while driving would continue, but emphasized that unless there was a reversal in the number of serious accidents the insurance companies would be forced to raise premiums.
“Should there not be any ease up in terms of the frequency and severity of accidents out there, then the industry… not necessarily collectively, but individual companies according to what their claims experience is like, would start taking measures in terms of increased claims, changes in terms [and] higher deductibles that would seek to mitigate some of the losses.