Guardian Holdings cites COVID mortality claims as big issue for Ja
Published:Friday | November 12, 2021 | 12:09 AM
G uardian Holdings Limited, GHL which operates regional insurance services, stated that it suffered higher payouts in the September quarter due in part to COVID-19 mortality in Jamaica.
“Our life insurance operations in Jamaica have been experiencing an increase in mortality claims on account of the low COVID-19 vaccination rate of the population,” said Chairman Patrick Hylton in a statement appended to the regional insurance group’s financial results.
COVID-19 has claimed the lives of some 2,200 Jamaicans since March 2020.
In the quarter from July to September, GHL earned net profit of TT$201 million (US$31 million) across all its operational territories, down 37 per cent from TT$320.6 million in 2020.
Year to date, January to September, the group made a profit of TT$457 million, down from TT$485.2 million in 2020. The financials for the Jamaica operations, which includes Guardian Life Limited and Guardian General Insurance, were not disaggregated. Revenues for the group totalled TT$1.6 billion, compared to TT$1.5 billion in 2020.
“Much of the reduction is related to the temporary effects of the COVID-19 pandemic,” said Hylton in the report. He added that the life insurance operations in Trinidad & Tobago were experiencing persistency challenges on account of depressed economic activity triggered by COVID-19-related lockdowns.
However, GHL’s outlook remains upbeat, as vaccinations activities are “continuing apace in our region, which would lead to more positive economic conditions,” Hylton said.
Guardian Life plans viewed by the Financial Gleaner offer a minimum coverage of $350,000, with maximum coverage of $3.5 million to $5 million for the term plans.
Efforts at further explanation from Guardian and Hylton on the mortality issue were unsuccessful.
A seasoned insurance agent, who requested anonymity as he works for a competing entity, told the Financial Gleaner that while he’s never heard of an average death payout for the sector, some plans can be costly to pay out.
Term insurance plans are graduated plans, with minimum coverage of about $250,000, but can range up to $10 million at maximum coverage; while medical whole life plans generally go above and beyond $10 million, due to affordability and health check-ups required, he said, explaining that he once sought to secure $500 million of coverage for a client under a whole life plan.
He also noted that insurance ceilings tend to change at intervals to reflect inflation.
“In my 10 years in the industry, the maximum coverage ceiling has moved thrice, from $2.5 million to $4 million, and over the last two years, to $10 million. So, the ceiling for a lot of these term plans have moved up,” he said.