Insurance firm says market is picking up
Officials of a United States based insurance company are expressing confidence in the Barbados market as they seek to expand their operations here.
Reporting an average growth rate of about 25 per cent in its local life insurance business last year alone, when compared to 2013, officials of Pan American Life Insurance Group (PALIG) say they are “heartened” by the achievements so far and are optimistic about the future.
In 2014 PALIG’s revenues reached US$703 million, an eight per cent increase over 2013. Of that revenue, the Caribbean represents 12.5 per cent with Barbados accounting for 25 per cent of the regional total.
Speaking at a media briefing this morning to announce the company’s 2014 performance, Group President and Chief Executive Officer José Suquet said the performance of the health and accident side of the business witnessed “significant improvements” last year when compared to the previous year.
He did not provide figures. However, he stated that the overall growth in Barbados was due to the introduction of various products, including those for high net worth individuals and term insurance, as well as the expansion and focus on employee benefits.
The performance so far this year, he said, was “flat”, while pointing to layoffs and the general economic climate.
However, Suquet said officials were expecting the region to grow at a rate of about 15 per cent this year, based on preliminary results, which would make the Caribbean the second fastest growing market for the company behind the US.
“As the tourism seems to be kicking back in, in Barbados we are looking forward to 2016 being a very strong year for us,” said Suquet, who is also the company’s board chairman.
He described Barbados as a “very inviting” jurisdiction. The insurance executive said it was an ideal destination for tourism and investment because of the infrastructure, expansion of financial services, sophisticated business environment, and safety of the country “compared to other jurisdictions” in which the company operated.
It was in 2012 that PALIG, which currently boasts US$3 billion in assets, acquired the then American Life Insurance Company (ALICO). Following that acquisition there have been improvements in the company’s operations.
Suquet said while it was clear that the Barbados economy had “hit a bump in the road over the last two or three years”, he remained confident things were beginning to improve.
“We have seen this year, increase in tourism. So we are optimistic that this is the precursor for the economy beginning to improve. We see a number of new, very high profile projects in the works now and beginning . . . all of this is going to bring tourism dollars to the economy.
“So the signs are there that you may be turning the corner as an economy and that is what we are clearly hopeful and banking on. That this region’s economy will improve because it is so heavily driven by tourism,” he said.
Asked about increasing competition in the insurance sector, Suquet said he did not feel threatened based on his company’s strong brand and financial strength, as well as its ability to deliver high quality service.
In terms of future operations, Chief Executive Officer and Managing Director for the Caribbean Bill Schultz said PALIG will be moving its administrative operations from Trinidad and Tobago to Barbados to serve the entire Eastern Caribbean.
He said the company will also be investing in new technology next year in order to help grow and improve customer service.
Schultz said he was hoping the change would result in an improvement in the time it takes to process claims and allow for more underwriting business.