The Bahamas Insurance Association (BIA) has commenced the collation of industry data in order to conduct a detailed economic assessment of the impact of Hurricane Matthew. The process will continue in the weeks ahead.

A month after Hurricane Matthew left The Bahamas, Chairman of the BIA Emmanuel Komolafe said he expects the insured losses attributed to damage from the storm to be in excess of $400 million.

Speaking with Guardian Business over the weekend Komolafe said, "I am advised that thousands of claims have been submitted with a significant amount of them settled to date."

He also insisted that the initial projection for reinsurance inflows between $250 million and $300 million would boost the recovery process as well as the economy.

Komolafe did not give specific details of the collation process.

Instead, he pointed out that the general insurance sector is expected to accumulate significant value-added tax (VAT) credits as a result of Hurricane Matthew and accompanying claims.

On the topic of VAT, he acknowledged that refunds would be due and payable to general insurers. "The BIA has been assured that all refunds will be paid on time and within the stipulated 28-day period. It is anticipated that the government will continue to meet its VAT obligations," he said.

Komolafe also warned about the effects of VAT in light of a natural disaster.

"While noting that The Bahamas would be one of four jurisdictions that imposed VAT on insurance products, the potential implications of major storms or multiple storms had been discussed.

"Our initial review of industry data has also shown that our commentary on the risk of an increase in uninsured and under-insured properties as a result of the imposition of 7.5 percent value-added tax (VAT) on insurance products that were already subject to three percent premium tax was justified," he said.

In addition, he spoke about the progress of discussions between the BIA, Ministry of Finance, the Bahamas Chamber of Commerce and Employers' Confederation (BCCEC) and The Central Bank of The Bahamas in the aftermath of Hurricane Matthew.

Komolafe said that the government agreed to address all confidentiality and data protection issues that might arise from the sharing of information by the insurance industry.

"One recommendation put forward is the incorporation of a waiver into the application which requires applicants for relief or financial support to authorize insurance companies to share their personal data with the government," he added.

Xian Smith, Guardian Business Reporter

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