Caribbean insurance companies have been challenged to play a pivotal role in ensuring safety and security within the regional tourism industry.
Citing Jamaica’s tourism recovery from the COVID-19 pandemic as an example, Minister of Tourism, Hon. Edmund Bartlett said that during the pandemic the insurance sector was needed on board as a safety valve to give assurance to visitors that they had protection if anything happened when they arrived at the destination. This, he said, was integral to the early recovery of the industry.
Minister Bartlett’s position was stated yesterday (May 14) as he delivered the keynote address at the Hall of Fame Induction dinner of the 34th Sales Congress of the Caribbean Association of Insurance and Financial Advisors (CARAIFA), held at the Hilton Rose Hall Resort and Spa in Montego Bay.
“As the islands act urgently to integrate resilience as a core component of its tourism development agenda, Caribbean insurance companies can play a critical role in helping to protect the tourism sector in the face of future crises,” he said.
He listed a number of ways in which the insurance industry can help to contribute to tourism resilience, such as providing coverage for loss of income and property damage caused by a variety of risks, including natural disasters, pandemics or other disruptions; helping businesses and individuals accurately assess the risk associated with their activities and providing advice on the types of coverage that should be taken out; and increasing awareness of the importance of having adequate coverage in place by engaging in public education campaigns.
Mr. Bartlett suggested that the campaigns could include providing advice on best practices in risk management as well as making people aware of the consequences of not having adequate coverage in place and educating travellers who are unfamiliar with the risk they could be exposed to and what insurance coverage to look for.
He also stated that the insurance industry could help to contribute to tourism resilience by investing in disaster response and relief initiatives such as providing financial support for businesses and individuals affected by natural disasters or pandemic-related disruptions as well as aiding in rebuilding efforts.
Minister Bartlett noted that at last week’s Caribbean Hotel and Tourism Association’s (CHTA) 41st Caribbean Travel Marketplace in Barbados, discussions took place on establishing a full pension plan across the region using as a model Jamaica’s ground-breaking comprehensive Tourism Workers Pension Scheme (TWPS), which involves two major insurance companies in the management and administration of the fund.
An important consideration is that “it has tremendous implications for capital formation across the Caribbean because there are one million workers in the tourism sector in the region; 643,000 of which are working directly in the industry and the others indirectly,” said Minister Bartlett, adding, “and if that pension plan is taken across the region as Jamaica has it, there is the potential to create a level of domestic saving, the size of which the region would never have seen” providing a pool of low-cost funds to build the Caribbean.
With Jamaica’s TWPS now fully operational, he said, “We now need a comprehensive health plan for the workers of the industry” and challenged the insurance sector “to craft an instrument that will enable a health security arrangement for the workers of the tourism industry in the Caribbean.”
With the theme for the CARAIFA sales congress focussing on resilience, Minister Bartlett also called on the region’s insurance companies “to build the human capital of our region.” He said, “Resilience has to come from knowledge, from building capacity for people to convert ideas into meaningful and practical application that will have a value and so we must build the capacity of our young people to think, not just to regurgitate information which they get by reading a text but learn to innovate.”
He, therefore, called on CARAIFA to work with the education system on a programme “to help to establish innovation incubators where young people can learn about financial administration, how to use their money properly and wisely, and learn what insurance is all about.”