The Bahamas Insurance Association (BIA), formerly known as the Bahamas General Insurance Association (BGIA), is a trade association of insurance companies, brokerages, and agencies licensed by the Insurance Commission of The Bahamas, dealing in all lines of General (property and casualty) and Long Term (life and health) insurance business. Four loss-adjusting companies are also members of the Association, which has as its main purpose the representation of the interests of the Insurance industry to the Bahamian Government and People, and to other local and international bodies.
The BIA is a merger of the membership of two pre-existing entities—The Bahamas General Insurance Association (BGIA) and the Bahamas Association of Life & Health Insurers (BALHI).
The Bahamas General Insurance Association (BGIA)
The Bahamian general insurance market had its origin in the early 1970s in a few isolated insurance agents formed mainly as a byproduct of local merchants who through agency agreements wrote business for composite general insurers mainly domiciled in the U.K.
Slowly, as the economy expanded and the demand for general insurance products grew, merchants spun off their insurance business into stand-alone agencies. The Road Traffic Act 1958 spurred this demand amongst the general population by the imposition of compulsory third party liability insurance for motorists.
The agency market grew steadily and in early 1972, just after the first Insurance Act was introduced (in 1970), the Bahamas General Insurance Agents’ Association (BGIAA) was formed. Originally the association consisted only of general insurance agents but in 1975, with the addition of underwriters and adjusters as members, the name was changed to the Bahamas General Insurance Association (BGIA). In February of 1993 the BGIA was incorporated under the Companies Act 1992, as a Company Limited by Guarantee.
The early 1980’s saw the emergence of the first Bahamian general insurance company, voluntarily formed and supported through its associated agency portfolio.
In the late 1980’s the mainly UK-domiciled composite insurers that wrote business in the Caribbean and The Bahamas had a rude awakening to the reality of their property portfolios’ exposure to hurricanes, after experiencing losses from Hurricane Hugo. The resultant retraction of capacity in the region by insurers and their reinsurers saw some of the composite insurers withdraw from The Bahamas, thereby creating the opportunity for the establishment of other insurers in the local market.
The local companies wrote business primarily for their associated agents. However, in the 1990’s there began a divergence by a few local insurers to offer their products to other non-associated agents/brokers in the market. In the late 1990’s the industry experienced the dilution of the foreign ownership of local insurers, and subsequent years saw the acquisition and mergers of agency portfolios of business by industry players to increase their market shares.
As may be gathered from the above, the pattern of distribution of general insurance products throughout The Bahamas is predominantly through agents or brokers. The general insurance market today is not the languid industry it once was. It is now saturated by a number of insurers, agents and brokers all competing for market share with price, particularly in the property or fire class, being driven by reinsurers.
The Bahamas Association of Life and Health Insurers (BALHI)
The Bahamas Association of Life and Health Insurers (BALHI) was established in 1974 by the Chief Executive Officers of a few local companies. The CEO’s decided that it was in their organizations’ best interest and that of the insurance industry for them to share ideas and, as much as possible, support each other. BALHI’s members included most of the life and health insurers operating in the Bahamas. Because of prudent management, the successful distribution of appropriate produces and the dynamic role which insurance plays in mobilizing long-term savings and investment, the member companies of BALHI were major contributors to the economy of the Bahamas. Consequently, they were significant donors to the national development and to the well—being of tens of thousands of Bahamians.
BALHI’s member companies participated in, and gave generous, financial support to varied and widespread community service projects. They were especially concerned about the welfare of the aged, infant and the chronically ill. In addition, they actively promoted good health, responsible lifestyles and the advancement of education and training at all levels.
Establishment of the BIA
Near the end of the first decade of the 21st century, the BGIA entered into negotiations with a number of Life and Health insurance companies that had indicated a wish to join with the BGIA and form a single Bahamas Insurance Association (BIA) This development followed on the dissolution of the Bahamas Association of Life and Health Insurers (BALHI) and the realization of the surviving members that an alliance with the BGIA was their best option for having a significant voice in the new regulatory environment in The Bahamas. As a consequence, at an Extra-Ordinary AGM on the 17thNovember, 2010, the members of the BGIA voted to 1) amend the Association’s Memorandum and Articles of Association to accommodate the membership of Life and Health Insurers and 2) change the name of the Bahamas General Insurance (BGIA ) to the Bahamas Insurance Association (BIA).
This combined association now represents the major players in the local insurance industry and allows the industry to speak with a strong unified voice in negotiations with the government and other bodies.