Stick to banking!

Members of the Barbados Association of Insurance and Financial Advisors (BARAIFA) are concerned about banks conducting insurance activities, and are wondering who is policing these banks from encroaching on the insurance market?

This issue was raised at a BARAIFA conference, held yesterday at the Lloyd Erskine Sandiford Centre.

President of BARAIFA, Lana Butcher, told The Barbados Advocate, “I would like the banks not to have this service; bankers need to do banking and let insurance professionals sell insurance and find solutions for their clients.

“The issue is that the market share is not that big, so if you have a client that goes to the bank and they would say I’m getting a mortgage and I need coverage, traditionally the bank would go to their agent and if they didn’t have an advisor they would call and get coverage. Now the banks are doing everything, which is cutting out the middle man; now the banks are monopolising the sale of life insurance.

“Insurance is something that is personal, it needs to be tailored to that client, whereas from my experience the banks would just be doing term insurance to anyone, while an insurance agent has to ensure that the plan is specific to that individual.”

While at the event Cleviston Haynes, Governor of the Central Bank of Barbados, in response to this concern, said: “There is a restriction at present on banks engaging directly in insurance business; I need more clarity in what exactly they are doing. Banks are not allowed to engage directly in insurance business, I would have to investigate further now that you have drawn the situation to my attention. I understand your concern – the point is what you don’t want is someone to go in a bank and mandate that you must use a certain firm in relation to insurance.” (NB)