Avia Collinder, Gleaner Writer

It's the age of the designer policy in which local insurance companies roll out packages for home and content coverage customised to suit varying income brackets.

However, most Jamaicans are not biting.

Jason Goldsmith, underwriting manager at Globe Insurance Company of Jamaica's Kingston broker division, notes that despite the greater frequency of storms and their attendant damage, there has been no significant increase in home- or content-insurance purchases.

coverage offered

Locally, general home-insurance companies offer coverage for fire, burglary, hurricane or windstorm, earthquake and flood, among other potential disasters. But, the larger proportion of local homeowners are disinterested.

"The proportion of local residents who insure," Jason Goldsmith states, is "frighteningly small."

Only 10 per cent of the Global portfolio is residential property.

Marcia Jarrett, customer-service manager at the Insurance Company of the West Indies (ICWI), adds that the company's telemarketing department saw "no significant level" of requests for coverage, neither for building nor content.

Insurance, other sector players acknowledge, is not cheap and property coverage tends not to be atop householders' budget lists.

"What I have noticed," says Jarrett, "people show interest in insuring buildings only if they have a mortgage interest and insuring the property is compulsory."

The insurance official believes that the pricing of available policies, the required two per cent deductible, and the application of the average clause are possible deterrents to the residential sector.

"A lot of people also do not insure at full value and the application of the average clause and deductible means that they only get a portion for the real loss."

Coverage on a property of reinforced concrete, with aluminium sheeting metal roof, and valued at $10 million, costs around $80,000 to $90,000 in premiums annually for comprehensive insurance

But, companies like Global Insurance have been trying to tap into new business by designing insurance products that are more affordable.

Launched earlier this year, 'Choices' allows the purchaser of the policy to insure a portion of the value of a property. In the event of damage, or should a disaster occur, the homeowner can use the payout from the claim to repair anything, including the roof.

The policy carries no two per cent deductible and no average clause, but it carries a flat deductible which varies - starting at a minimum of $50,000 of payout.

policy cost

The policy costs around $50,000 in annual premiums and offers savings of $40,000 on the alternative, comprehensive homeowners' policy.

Choices is not sold to homeowners with houses within 500 feet and below 50 feet of a high beachfront or body of water.

Jarrett says that ICWI has introduced payment plans for its clients as well.

"You can pay insurance half-yearly or even on a monthly basis as well," she tells Sunday Business.

"It, we realise, can be costly and we have put measures in place to mitigate financial strain."

Content insurance tends to be a lot more affordable.

Jarrett notes that premiums of $7,500 per annum can buy up to $800,000 of coverage.

Appliances can also be covered with an all-risk policy which covers accidental damage, as well as damage from natural disasters.

At Globe, content insurance starts from $5,000 plus tax in annual premiums, subject to construction, and covers content value of up to $750,000.

The rate for homes of concrete and slab-roof construction is lower than for contents in homes of zinc roofing.

Contents in a house with a zinc roof will only attract coverage of $550,000 for the $5,000 annual premium. The two per cent deductible also applies.

avia.ustanny@gleanerjm.com