The Importance of Insurance
At some point you may have asked, "Do I need insurance?" The simple answer is "Yes, you do."
By Evelyn Tibbetts-Farrar, Vice President, Underwriting of Island Heritage.
It protects our loved ones and us when we need it the most. Leaving yourself uninsured puts you in a precarious position, so it is important to understand how insurance works and why it is necessary to have it.
Insurance is unlike other commodities as it is intangible. When a company sells an insurance policy, they are selling you a promise, a pledge that in the face of a loss you will be indemnified, as well as the peace of mind knowing that you will be able to get back on your feet.
For many people it would be possible to recover financially after a relatively small loss; however, where insurance really comes to the rescue is in the event of an expensive financial catastrophe.
The absolute necessity of having insurance in the Caribbean region was demonstrated in the Cayman Islands during the aftermath of Hurricane Ivan in 2004, which left a trail of destruction. Almost 85% of the buildings in the Cayman Islands were severely damaged or destroyed completely.
The Cayman Islands faced many challenges during the rebuilding effort, but amazingly, in just a few months following this devastation tremendous progress had been made towards recovery. The community showed remarkable resilience and spirit in their efforts to rebuild, and the local insurance companies played an important part in the recovery process - the Island would not have been able to recover in such a timely manner if not for insurance. Based on reports from the insurance companies, the Cayman Islands Monetary Authority estimates a total payout of $1.15 billion to insureds.
When choosing an insurance company it is important to ensure that they are well prepared for such disasters with high limits of reinsurance and a strong panel of reinsurers to allow for timely processed customer claims and continued service long after the effects of the disaster have passed.
It is also important to select an insurance company that provides policies that are specifically tailored to your region's vulnerabilities. For example, Island Heritage was the first company in the Caribbean to exclusively target the property insurance market, providing a wide range of residential and commercial policies with a special emphasis on catastrophe insurance.
Another thing to keep in mind is that by signing with a larger insurance company you are often able to acquire lower annual rates by way of their ability to offer multiple packages on property and casualty, life and health insurance. The larger insurance companies are also often more reliable due to their larger asset holdings. A matter of importance should the company's financial stability and ability to meet all its obligations when events of a catastrophic nature occur.
Regardless of which insurance company you choose to sign with, what matters most is that you have insurance. Life is full of unexpected moments; make sure you and your loved ones are protected when it matters most.
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