Property owners in Cayman Islands can expect to pay between 10 and 30 per cent for insurance this year.
According to the Cayman Islands Insurance Association (CIIA), homeowners will have to pay more given the increasing damages caused by hurricanes over the past three years.
Despite having no major impact from a hurricane in recent time, the CIAA says the islands will see their premiums increase because of their susceptibility to these systems, similar to their regional neighbours.
“As a result of this, international reinsurers have increased their coverage costs for the region.”– The Cayman Islands Insurance Association
“Although we in the Cayman Islands have been fortunate to avoid any major hurricane losses since Hurricane Ivan in 2004, we fall into the same reinsurance pool bracket in the Caribbean and face similar risks and consequently, it is necessary to increase premium rates this year,” the CIAA said in a release.
Further, the CIAA said given that the basic principle of insurance and reinsurance is the pooling of all premiums received to pay for claims to those who have suffered damages, rates will increase “between10 per cent to 30 per cent dependent on various factors such as type of construction, protections, property location and elevation.”
The Atlantic region has been hit by several major storms in the past five years, with 2019 being deemed the fourth-most active hurricane season on record. It was also the fourth consecutive year of above-average activity. It included the passage of Hurricane Dorian which alone generated more than US$8 billion of insured losses across all territories affected by it last year.
Before that, 2017 saw major hurricanes Harvey, Irma and Maria causing insured loss of more than US$90 billion, said the CIAA adding that “As a result of this, international reinsurers have increased their coverage costs for the region.”
The Atlantic hurricane season runs from June 1 to November 30 of each year.