Key rolls out water sports, solar insurance products
Key Insurance Company Limited is now offering insurance for water sports and solar panels as new lines of business to grow revenue.
“We just started promoting them in May. So I am unable to say the premiums generated from the two products,” said Key General Manager Tammara Glaves-Hucey at the company’s annual general meeting.
The water sports product covers liability for operators.
“For instance, if they are taking guests on a glass-bottom boat and there’s an incident, then there is liability exposure, which we do have in place for such operators,” said Glaves-Hucey who earlier explained the rationale for the coverage. “We have been getting increased requests for quotations, particularly for water sports liability. And so, we created this particular product to meet the needs of these requests,” she said.
The solar panel insurance offers coverage to homeowners, businesses and installers.
“We do provide coverage for the panels and for the contractors or service providers who would be installing them,” the GM said.
Solar panels tend to represent a considerable investment by homeowners. But the panels are vulnerable to damage from fire, wind, wear and tear, and damage from falling objects.
The company is innovating amid uncertainty, but is expecting the effects of the pandemic on the insurance market to continue to diminish over the next year.
“We believe that the insurance industry will continue to see the diminution of COVID-19 over the next nine to 12 months. But we have already seen an increase in operational expenses,” said Glaves-Hucey, blaming foreign exchange fluctuations, double-digit inflation and increased claims activities.
“We have seen an increase in claims. There has been an increase in frequency in motor accidents. Some have led to fatalities. It has a multiplier effect not just on claims, but on families and lives.”
Key’s strategic pillars for 2022 are the “same as in 2021, but with greater intensity”, according to the slides displayed during the GM’s report to shareholders. The pillars are sustainable growth and innovation, customer-centricity, operational efficiency, and a performance-driven culture.
“Despite the headwinds, I am confident that 2022 and beyond will be a success for Key, as we work together to take hold of a larger share of Jamaica’s insurance market,” said Chairman Don Wehby.
Key’s minimum capital test ratio stood at 286.1 for 2021, or well above the 112.5 per cent in 2018, when the company got into heavy losses. The insurance regulator, Financial Services Commission, requires an insurer’s capital to surpass a measure of what it insures by two and a half times, or 250 per cent.
The former majority shareholders of Key Insurance sold controlling interest in the failing company to GraceKennedy Group to save it.
GraceKennedy immediately replaced the management and board members, and set about reforming the finances and insurance arrangements and returning it to profitability. It also recapitalised the business through a rights issue.
In the quarter ending March, Key reported a 227 per cent spike in net profit to $2.29 million on net premium of $346.7 million. The company holds $1 billion in equity and $4.6 billion in assets.
Among the initiatives executed since the conglomerate took over the business, is an online payment portal and new products, such as Key Protect and PPV Protect. The company now plans to roll out a mobile app.