PHILIPSBURG--The St. Maarten Insurance Association (SMIA) anticipates an increase in insurance premiums of fifteen per cent or more this year, SMIA President Robert de Vries said in a letter sent to The Daily Herald on Wednesday.
According to the letter, this is due to recent global natural disasters that have impacted the reinsurance market, resulting in a shortage of available coverage in the Caribbean region. “Unfortunately, this means that we have no choice but to pass on these increased costs to policyholders.”
These increases are mainly due to 2022 results, which saw 421 adverse weather events, ranging from widespread hailstorms in France to catastrophic monsoonal floods in Pakistan and India, devastating fires and windstorms in America and Australia, and severe droughts in Europe.
These extreme weather events amassed total insured pay-outs of around US $132 billion, with total economic (uninsured) losses equating to around $313 billion. It was the second costliest year on record for reinsurance companies, second only to Hurricane Katrina in 2005, the letter explained.
“We understand that this news may be difficult to hear, especially given the challenges you have already faced with rising inflation and other economic issues. We want you to know that we are doing everything we can to minimise the impact of these premium increases. However, we anticipate that your residential and commercial property premiums may increase 15% or more.
“We also want to remind you that St. Maarten is located in a highly active hurricane belt, and it is crucial to ensure that you have adequate insurance coverage in case of any unforeseen events. We encourage you to speak with your local insurance representative if you have any questions, comments or concerns,” De Vries concluded.