Chairman (Billy Craig Insurance Brokers Limited)

As you know, the first things that an investor looks for prior to investing in a foreign country are a trustworthy lawyer, bank and insurance company. What does the Jamaican financial system offer to assure investors that they are coming in to a country with a solid financial system?

In my opinion, the financial sector in Jamaica is well regulated so any investor that comes here should feel safe that we do have a secure and stable financial industry. The banking community is heavily capitalized and very well regulated in terms of who they can lend to and how much they can lend to each party. So investors should feel comfortable that the bank will not overleverage them and put them in a difficult situation.

The insurance industry is very well protected as well because all insurance companies have to meet minimum asset and capital tests and the Financial Services Commission oversees all reinsurance that they put in place. Also given Jamaica has a small business environment, the local insurance industry is heavily reinsured so people should feel very well protected. You would know that all reinsurers in Jamaica are A-rated. Reinsurance here is generally led by Munich Re or Swiss Re but the other reinsurers are would all be A-rated as well.

Also in Jamaica brokers place business not just with local underwriters but also with overseas-based underwriters. So we are able to access that A-rated security directly if clients want. Through our Lloyds brokers we have direct access into the Lloyds market so we can come up with more innovative products that clients may want. The capacity of the local insurance industry is just USD50 million so sometimes a placement requires us to supplement local placement with overseas capacity.

President Obama just became the first US President to visit Jamaica in 33 years. How do you think Jamaica will benefit from his short yet historic visit?

I think Obama’s visit is an acknowledgement of the success our government has had in implementing and executing the present IMF agreement. The execution of our IMF agreement has been difficult. From what I hear it’s the most strenuous IMF agreement in existence today in terms of the primary surplus that we have to abide by. Yet we are fulfilling the requirements. It’s a huge accomplishment and I think Obama’s visit is an acknowledgement of that and our success story. However I would think that there’s a certain amount of hype and confidence building regarding that but with that being said, there is recognition. I don’t think Obama’s visit changes anything. I think Jamaica is at a difficult point in our economic history and we still have a hell of a fight left to go.

The insurance industry is fiercely competitive. What makes Billy Craig Insurance Brokers so successful?

Billy Craig was started by my father in 1963 when he bought an existing insurance agency. He was an incredible sales person who was best out on the road delivering claims cheques, rather than in the office. That personal one on one service built Billy Craig and I think that my team and I have built on that. We have significant clients who have been with us through the entire 52 years of our history. I don’t know how many financial entities in the world can say that so that’s a powerful message to send to potential clients. We provide that level and quality of service that you can count on and while we are not perfect and do make mistakes, I think that our clients recognize that we are faithful to managing our client relationships with integrity. So if there is a mistake or problem, it’s addressed in a timely fashion, and I think that’s what makes Billy Craig.

How is Billy Craig different from an insurance company?

An insurance company has the responsibility to look after their balance sheet. They take a client’s risk and underwrite it to ensure that they not only protect their client but also to protect their own financial statements.  As a broker, Billy Craig represents the person who is purchasing the insurance. We have a responsibility to protect the insured’s balance sheet, not the insurer’s. It’s a very distinct role. So we take a client’s risk, analyse it, put it together in a presentation and present it to the insurance market. We get the best price and terms and conditions that we can, present the options to the client and show them how they can effectively transfer the risk to suitable underwriters that will protect their interests. To give an example, you may have a property by the sea. One underwriter may say I’ll provide you X rate but I won’t provide hurricane cover. Another underwriter may quote a higher rate but will provide hurricane cover. Some clients, depending on the price difference, are willing to take the lesser cover and absorb the risk themselves. That’s what the insurance industry really is about because if a client decides they want to protect themselves from every single possible risk then all of their profits will be transferred to the insurance company in terms of premiums. It’s our job to help them manage that risk and transfer a certain amount that properly protects their business but also empowers them to put cash in their business and go forward.

With operations in more than 120 countries, Aon is the second largest insurance broker in the world. How has Aon benefited from its partnership with Billy Craig Insurance Brokers?

We approached Aon as the company wanted to provide their clients with a superior level of insurance protection, advice and risk management in Jamaica. We had long discussions with them over 18-24 months and we convinced them that we were well positioned to offer that. We had our head office in Montego Bay so we were well positioned to look after their clients in the hotel and BPO industries. We also had an office in Kingston so we could look after their industrial and commercial clients that may be based there. We approached them about the partnership and we know they are happy with their choice.

How has the partnership with AON benefited Billy Craig?

Given we are the AON correspondent here, a portion of our business comes through AON. A lot of the larger investors that come here tend to have a relationship with some of the large brokers overseas so if that overseas investor is not a client of AON but of Willis or Marsh then the business would go to their local brokers.

Does Billy Craig have much experience with foreign clients?

We have significant experience with foreign clients. Especially being on the north coast of Jamaica, there are a lot of people from overseas who invest either in hotels, mining or BPOs. It is a bit of an adjustment because an American would come here and would be accustomed to how they do insurance in North America versus how insurance is done here. It’s a little different and of course they expect it to be done the way it’s done there and it’s not. So one has to learn to understand what they are looking for and explain what it is they can get and how they can get it or something similar. In North America, for example, liability is looked at a little differently than it is in Jamaica. In North America if an incident happens you’re virtually culpable whereas in Jamaica it’s more based on British law where the culpability needs to be demonstrated and negligence needs to be proven.

In a world that is exponentially competitive, innovation is crucial for the survival of any company. What is Billy Craig doing to innovate and stay competitive?

It’s part of our vision to be innovative but what we have found is that it’s somewhat difficult to bring in a new product and market it effectively. We were, however, the first people to bring jewelers block insurance to Jamaica, which is specifically for parties who are in the jewelry business. That was a long time ago but it was successful for us.

We brought in a product a few years ago that was pension fund trustee liability because there are a lot of pension funds in Jamaica and if you are a trustee of a pension fund, you’re legally liable for your responsibilities. That product, however, has not sold nearly as well as we would like it to. I think this is because traditionally Jamaica has not been a litigious society and to date there has not been a single lawsuit against a trustee so nobody feels the risk. You buy hurricane insurance because you’ve experienced hurricanes and feel the risk. You buy car insurance because you know you will have a car accident at some point.

Corporate social responsibility (CSR) is a useful measure for giving to the communities in which you work and your hard working personnel. What CSR projects is Billy Craig involved in?

We have a scholarship that we give to a young boy each year from the Montego Bay Community College, which is right next door to us. Obviously our educational system is not as good as it should be and as an organization that’s in a very knowledge-based industry, this hurts us. So when we get somebody in here they’re not where I believe they should be in order to contribute. I’m not talking about their insurance knowledge but their understanding of how the economy and business operate and what makes someone want or not want to buy something. Language and mathematic skills need to improve so by investing in something like that, even though it’s just one person per year, inevitably we reap the benefits down the road. So, for example, about 9 years ago, we helped a young man who was 12 years old at that time. We helped pay for his schooling and someone to ensure that he got the afterschool nurturing and support that he needed because he wasn’t getting that at home. Last year that man applied to work at Billy Craig and right now he’s working as a receptionist. Although he hasn’t done university, his ability to absorb information and develop is sensational. So by doing that one little gesture we are already reaping the benefits. So I think that we should all be conscious of the fact that when you give back in a minor way, you reap the benefits exponentially, far greater than the amount of money that you put in in terms of the scholarship.

Billy Craig Insurance Brokers has 52 years of experience in the insurance and broker business. What do you think is the most important skill set for a boss of a successful company like yours?

I think the most important skill set is to have a high emotional quotient and consequently the ability to deal with people. I believe that you could successfully run Scotiabank with minimal knowledge of the financial industry because you employ, empower and lead all of the people with financial information. I really believe that is the most important thing and I don’t believe that our educational system worldwide focuses on that. When I look at Billy Craig over the last 20 years, yes we have developed people who have empowered Billy Craig, but we haven’t strategized and had a development plan for each of employee. Had we done that, Billy Craig would be twice the size that it is today. That’s something we are doing now so we will reap the benefits in 10-20 years from now but had we done it years ago, we would be far better off today. I think the same applies to the education system. If we strategize education that way, we will create more leaders and as a result, we would be more powerful generally.

The readers of Harvard Business Review include many of the world’s most influential business and political leaders. What message would you like to send them about Jamaica?

Jamaica is ripe for development and its economy is at a crossroads. I’m not saying that the environment is perfect but I do think that people can come here and successfully operate a business that they will be happy with 20 years later. Jamaica went through a lot of turmoil in the 70s and the people that stayed are very happy that they made that decision. I would say to overseas investors that the quality of life here is superior to what many people could get in North America or the United Kingdom. We live an incredible life here and naturally that’s part of the investment as you want to enjoy your life as well as reap the financial benefits. If I step out of my front door, I walk into the ocean. I live 5 minutes from my office, 10 minutes from my daughter’s school, 12 minutes from the airport and 10 minutes from the beach. That’s a life that is unparalleled anywhere else in the world.

And a message in regards to Billy Craig?

I believe that Billy Craig is very well positioned to offer a superior level of service and insurance products both from the local and international markets that can satisfy any potential client. No other insurance broker in Jamaica is able to surpass our ability to give advice and get the right price, conditions and cover.