‘Some doing well, others catching hell!’- Banks & Insurance blasted over local treatment
The Opposition Leader claimed that some insurance companies were running Ponzi schemes and banks were engaged in “predatory practices”; however, he did not provide any evidence for these claims.
Hon Skelton shared that his life insurance had now doubled, leaving him to wonder where the cash would come from to pay the premiums, “Where am I going to get that disposable income to pay for life insurance premiums?” he asked rhetorically in the House.
Hard times? - Skelton
Hon Skelton, a former Minister of Finance (2003-2007), told the HoA that no major banking decisions are made in the Virgin Islands.
He noted, “Our country is unbanked, if there’s such a thing. We need to find out what is happening. Some of us are doing well, while others are catching hell.”
Hon Skelton added that business owners, specifically those in the tourism industry sector are suffering under pressure from the institutions in question, “restaurants and hotel owners are not doing well and have loans at the bank, which is calling for their monies,” he added.
Hon Skelton asked that Deputy Premier, Hon Lorna G. Smith OBE (AL), who is the Minister of Financial Services, Labour and Trade, pay closer attention to the issues surrounding the sector before it is too late.
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28 Responses to “‘Some doing well, others catching hell!’- Banks & Insurance blasted over local treatment”
He will never be premier
For example, are borrowers increasingly and consistently failing to meet loan payments on time consistently with the agreement between the bank and lenders? Have the financial income situations, ie, business slow down, co-borrower laid off/ill, etc of borrowers change , resulting in ability to pay? Have banks made a genuine attempt to work with borrowers but to no avail and the only option is to foreclose? Banks are businesses, not charity, operations and have to operate as businesses. Failing to collect on loans are an opportunity cost to banks. Let’s remember that local branches are responsible and accountable to their overseas headquarters. Are customers complaining about low interest on savings? Well, low interest in savings is an indication that banks have surplus cash and don’t need cash but borrowers. BVI borrowers must be aware that what you qualify to borrow may not be what you can afford; they are two different things. Stay within what you can afford,,not what you qualify. Why is insurance, ie, automobile, house, causality, life, etc. so expensive in the BVI?
Insurance is a pooling of resources to share in the risk. The larger the number of policy holders the cost can be spread over a wider base, lowering the cost per policy holder. The BVI is a small community of approximately 30,000 people, so if insurance is based on that small number, rates are going to be high. Group insurance is cheaper than individual. Insurance is about large numbers. The Law of Large numbers is used to predict annual loses and payout. Home owners in the BVI must be aware of 100% replacement cost, especially the 80% rule. Simply, if your property is insured for $500000 and if you incur a $500,000 lost, you will be reimbursed 100% for the loss. Further, if the replacement is $500,000, and if you buy a policy for 80% of the $500, 000 or $400,000. And if you incur a $500, 000, you will only be
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RWS
I already see that more of us will be forced into foreclosure or bankruptcy. We the people need to boycott those insurances with extremely high rates forcing them to lower premiums. Also, the banks use to offer insurance and perhaps they should do so again. Banks are forcing people to get insurance es they cannot afford and that is wrong.