Bahamas News

Despite the Atlantic Hurricane Season having already started, insurance brokers are continuing to urge locals to ensure that their hurricane policies are updated.

The reminder came as the Minister of Finance disclosed that The Bahamas is now able to access US $25 million from the Caribbean Catastrophic Risk Insurance Fund [CCRIF]. The government has allocated a $1.2 million contribution to the fund in the 2007/2008 fiscal budget.

President of the Bahamas General Insurance Association Robert Hardy endorsed the effort.

“This is a pool for the governments in the Caribbean to draw from for repairing docks, bridges and roads,” Mr. Hardy said.

“It would repair things that they own that were damaged by hurricane. It would not affect general insurance but it would be good for the country.”

Access to the fund places the Government of The Bahamas in the position to have immediate access to liquidity in the event that a natural disaster strikes like a hurricane. For homeowners, securing adequate insurance protection, is a key protective measure.

Operations Manager at Sunshine Insurance Brain Moodie said the home should be the first priority.

“You need any property insurance because you want to protect your assets,” Mr. Moodie said. “Your home is the most valuable asset you have and you want to protect it, not only from hurricanes, but from any type of damage.”

Mr. Moodie explained insurance rates are not determined by individual companies, but by larger reinsurance companies. He added that because hurricane seasons become more eventful, the rates are not likely to decline anytime soon.

“[Reinsurance] companies have sustained a lot of loss over the past three years and they have increased their rates accordingly,” Mr. Moodie said. “From a catastrophe point of view, local insurance companies don’t have a lot of flexibility when it comes to premium rates.

“Although we have seen a stabilization of hurricane rates from last year to this year, unless there is another quiet hurricane season, rates will not decrease.”

According to Mr. Moodie, currently the general rates for hurricane insurance is between 1.4 and 1.5 percent of the home’s value.

Mr. Moodie said rates of hurricane insurance premiums are also determined by the cost of rebuilding the home.

Gayle Farquaharson of Royal Star Insurance explained the mechanics of a typical hurricane insurance policy.

“Most of our policies are written on what we would call a full-cover basis or including catastrophe cover basis, meaning that there is a list of perils that include hurricane coverage,” she said. “What we mean is that it is catastrophe coverage in the event of a loss.”

The advice is for persons to have their homes appraised every few years by a licensed appraiser because building prices are increasing.

There have been cases where some people may have their homes insured for $200,000 when, in fact, they may be worth a whole lot more than that.

Mr. Moodie added that the rates for coastal homes are significantly higher than any other home.

“If your property is closer to shore or in an area that is prone to flooding or high winds, the rate what you pay on the property will be higher than someone living in a more sheltered area,” he said.

He said the construction of the home is also important in determining rates for hurricane coverage.

“There are some homes that are wooden and there are some homes that have tiles for roofing,” he said. “Underwriters would look differently on those homes because tile roofing would be resistant to fires but not necessarily hurricanes. It depends on the underwriters and what they think is a risk.”

Insurance brokers acknowledged that the Caribbean is more susceptible to hurricane losses.

The World Bank which helped CARICOM to set up the US $110 million CCRIF noted that countries in this region are highly exposed to adverse natural events which can result in disasters affecting their entire economic, human and physical environment.

By Kendea Dames
The Bahama Journal

In today’s global business environment people are paying less and less with cold, hard cash and are moving more and more toward plastic– credit or debit cards.

Staying abreast of the global trend, Tripoint Communications this week launched its wireless solution for credit card payment.

The communications solution company is the first local company to conduct beta testing of the wireless credit card terminal in The Bahamas.

President Christopher Brown presented straw vendor Sheanda Cooper, Torpedo of Torpedo Limousine Services and Action Jackson of J.R. Action Water Sports with wireless terminals, enabling their businesses, which cater mostly to tourists, to accept credit card payments.

Tripoint also announced on Wednesday a “partnering agreement” with Euronet, the number one provider of prepaid electronic top-up services in the world, having over 386,000 clients connected to its datacenters globally.

“Because we understand that today, we live in what is commonly referred to as a global village, Tripoint has further strengthened its position by having aligned itself with several international partners who on a global scale provide various technological solutions that either complement what we do or empower us to offer additional solutions to the local community,” said Mr. Brown.

“Today this alliance provides Tripoint the ability to make available to the local market the provision of any form of prepaid Top-up including that of the “Pin less” solution, which is currently being used in the U.S. and many other countries around the world.”

The partnering with Euronet enables Tripoint to offer, “Electronic prepaid Top-up” which a customer uses to add minutes to his cell phone electronically.

Mr. Brown revealed that Tripoint is the number one provider of this solution locally through the verifone credit card terminals that are distributed throughout the Bahamas.

The company’s international partner for wireless solution for credit card processing is Verifone, a leader in providing credit card payment solutions.

Tripoint had its genesis in the back trunk of the car of its president in 1996. Christopher Brown, a business administration graduate, after doing stints at First Home Bank, Commonwealth Bank, Bahamas Telecommunications Corporation (BATELCO) and Exxon Mobile, started providing inks and ribbons for credit card machines.

By 1998 the business started in earnest when Mr. Brown, his brother Owen and Kenneth Strachan all with banking experience, incorporated Tripoint and started business with headquarters on Nassau Street.

The core business of Tripoint is providing point-of-sale solutions.

“We offer to the business community solutions that will help to facilitate and enhance the day to day operation of their business; whether it’s the acceptance of credit card payments, the managing of inventory, or the process of ensuring that transaction are accurately mapped to the appropriate GIL accounts on the back-end; to successfully accomplish this we provide both hardware and software solution,” said Mr. Brown.

“Maintaining credit card terminals was something BATELCO previously had responsibility for, but during the time when they were downsizing and outsourcing, it was an area that fortunately for us, we were rightly positioned and had already been engaged in point of sale solutions.”

A neutral entity, Tripoint works along with the clearing banks and merchants to facilitate credit card service to consumers.

“We write software applications for these terminals that can also provide additional ser vices… several different applications can run across them that are independent of each other,” said Mr. Brown.

“For instance, a merchant may want to issue a loyalty card to some customers; may want to offer selective discounts; may want to manage the movement of employees; or facilitate the sale of phone cards. We provide all these added value services to the business establishment.”

Tripoint has a presence in Freeport, Abaco and the Turks and Caicos Islands.

By Norman Rolle
The Bahama Journal

A key detail emerged this week about the planned effort to determine and catalogue more comprehensive details about the pertinent economic developments in The Bahamas.

The Minister of State in the Ministry of Finance Zhivargo Laing disclosed that the budget proposed by the Ingraham administration makes provision for a $1.5 million allocation to finance the undertaking.

It was former prime minister Perry Christie who revealed early this year the intention to conduct the Economic Census for the first time in the country’s history. But the ousting of the PLP administration in the May 2 general election put an end to the former government’s spearheading of that initiative.

Minister Laing said in Parliament this week while delivering his contribution to the 2007/2008 budget that the Department of Statistics is to receive an allocation of $6,087,597, an increase of some $2,198,748 or 56.5%. A portion of the increase includes the $1.5 million for the Economic Census.

“[The census] would provide the kind of comprehensive establishment information to facilitate the creation of a national business register and assist in creating appropriate models for future annual sampling and surveying of the business sector,” he explained.

“This will enable us going forward to capture much better data about the commercial sectors of The Bahamian economy and therefore provide better quality data for national accounts.”

Additionally the effort is designed to also facilitate the collection of industry data from the Family Islands, most of which have not been surveyed before.

Director of the Department of Statistics Charles Stuart said in an earlier Bahama Journal interview that the economic census is a strategic element in the evaluation of national business structure and activity.

“It is basically essential for the production of national accounts estimates where we compile information on the GNP [Gross National Product] and the GDP [Gross Domestic Product]. One of the main reasons for the census is also to use it as a means of development of annual household surveys.”

Such a mammoth effort involving the collection of strategic data from businesses in various sectors all around New Providence and the Family Islands would involve substantial amounts of resources.

Mr. Stuart admitted that the process would indeed be challenging.

“An economic census is a very difficult census to do,” said Mr. Stuart. “In fact I do not think there is any country in the region that attempted to do an economic census the way we are trying to do it…[getting information] from all of the industries. What they would do is conduct censuses over a period of time, so they would collect data on the wholesale and retail sectors this year and another census on another sector in another year.”

The Department of Statistics intends to complete its census in a singular effort, according to Mr. Stuart, who conceded that it would require significant amounts of funding, employees, training and expertise in interacting with the business community.

Officials plan to request information on various elements of business operations like employee volumes; wages; hours worked; expenditure, revenue; acquisition of capital goods and commodities.

The intricacies of the census are still being fine-tuned. The department intends to make optimal use of strategic entities that could also provide crucial data of areas like fisheries, the wholesale and retail sectors and financial services.

Originally, Mr. Christie had intended for the census to be undertaken later this year. There has been no new indication about a potential change in that schedule.

Minister Laing acknolwedged that the Department of Statistics continues to offer critical services to the country in the preparation and publishing of national statistics across a wide range of social and economic activities.

“It is my anticipation that it will do even more in the years to come,” he said.

“It was in fact the IDB assisted Living Conditions Survey 2001, sometimes referred to as the Poverty Study, conducted by the Department of Statistics that has contributed to the provision in the 2007/2008 budget of $3 million toward poverty alleviation.”

He added that a number of recommendations arising out of that study will lead to programmes generated by the Department of Social Services that will provide relief to the poor among us, many of whom are our nation’s children. The programmes are intended to be aimed at addressing the immediate needs of the persons affected while simultaneously seeking to move them out of their impoverished state.

By Tameka Lundy
The Bahama Journal