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Insurance Firms Urged To Develop Products For Lower End Of Socio Economic Scale

  Government is urging insurance companies to become proactive and develop products to suit the socio-economic needs of those outside the metropolitan cities and towns in Fiji. Attorney-General and Minister
12 Aug 2016 14:41
Insurance Firms Urged To Develop Products For Lower End Of Socio Economic Scale

 

Government is urging insurance companies to become proactive and develop products to suit the socio-economic needs of those outside the metropolitan cities and towns in Fiji.

Attorney-General and Minister for Economy, Aiyaz Sayed-Khaiyum, was referring to the disaster-stricken people who had no form of insurance which could protect them following the aftermath of TC Winston.

Mr Sayed-Khaiyum was speaking during the Seminar on Property Insurance in Fiji yesterday held at the Novotel Suva Lami Bay.

He said there are two categories of people in Fiji; one who are insured and can afford it and there are the other category of people who are uninsured.

He said it was the uninsured people who had to be dispersed with $88 million because of the impact TC Winston had on them and their livelihoods.

“We have estimated 32,000 to 40,000 people whose homes were either completely damaged or substantially damaged or partially damaged,” he said.

“These are the people who fall in the basket of people who do not have any support or any form of insurance.”

Mr Sayed-Khaiyum said Governments cannot year-in and year-out simply keep on giving out that amount of money without Government or the private sector itself or home owners themselves without having some form of insurance.

“And I think it is unfortunate the insurance companies have not been proactive in coming up with products that will suit our socio-economic circumstances,” he said.

“So there is an opportunity there for the insurance companies together with Government playing a role to offering cover to these people but you could cap it.

“You could have reduced standard but of course not a reduced standard for the insurance companies but some standard that will meet certain categories of cyclones.”

Mr Sayed-Khaiyum stressed he was just suggesting the opportunities there exists and did not want to make the seminar about bashing the insurance companies.

“The idea is to come up with some good solutions going forward in terms of what we can do and what insurance companies can do and their role in terms of furthering cover in areas where there is absence of insurance,” he said.

Housing policies

Mr Sayed-Khaiyum further emphasised the need to adapt to climatic conditions which are continuously changing.

“But it does not always mean gloom and doom situation.  Your ability to manage that is the test of how the society is able to survive any changes to the climatic conditions,” he said.

He stressed adaptation also means the need to look at how the insurance industry needs to adapt itself to the challenges that we face as a country and the opportunities that arise as a country.

One of the areas Government is looking at developing is home ownership whereby the rate of home ownership in Fiji is very low.

“We had a meeting with the association of Banks last week and they came up with the initiative themselves and we hope to have regular meetings now,” he said.

“We discussed how the government is focused on increasing the home ownership with very low rates.

“We don’t have such an arrangement with the insurance council but we hope to develop it after this.”

Mr Sayed-Khaiyum said the insurance companies play a very pivotal role in all of this.

“What I am trying to say is Government is focusing on increasing home ownership – it cannot happen without it being financed – the banks come into play. The banks will obviously want insurance.

“Thus there is an opportunity for insurance companies to become a party in respect of this focus.”

Edited by: RACHNA LAL

Feedback:  rachnal@fijisun.com.fj

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