Dec 2009 Financial News

GHL looking to Central America

Dec 09, 2009

Insurance group Guardian Holdings Ltd is more focused now than it has been in a while.

Group chief executive Jeffrey Mack describes the process to write off hundreds of millions of dollars of struggling business and ring fence its core operations as a ’refocusing’ of the Westmoorings-based group.

GHL remains a financial powerhouse focused on the ’almost recession proof’ business of life insurance.

’In fact, as you enter a recession, consumers increase their purchases of life insurance,’ Mack told the Business Express recently.

This is reflected in revenue growth of six per cent.

On the general insurance side, interest rates have fallen but insurance firms have increased their rates slightly and the effect has been a stabilisation of returns in the business.

Responding to the effect of the meltdown this year of insurance and real estate conglomerate CL Financial and its flagship company CLICO, Mack said Guardian Holdings benefitted from the fall of the CLICO empire.

’We had a number of Clico agents approach us for employment and we used the opportunity to cherry pick the best of them,’ he said. ’We’ve been able to benefit from that.’

As GHL moves from a net loss of $655 million through September 30 (even though its core businesses produced a net after tax profit of $241 million), Mack says that with the expenses being reduced and portfolios in Jamaica and the Netherland Antilles, it is now a good times to pursue options in other countries.

GHL is immediately excited about prospects in the Central American market.

’We are either one or two in the markets that we operate, there is a high degree of penetration,’ he says, referring to the millions of consumers in the Caribbean.

But when one looks at growth, ’Central America is very much in our focus’, Mack said, explaining that the group was enthusiastic about the young, well educated and economically strong population in those countries in that region.

Many consumers in these populations have lots of disposable income but they have not channeled much to grow the insurance industry there.

’It’s almost natural to look at that market which has relatively low penetration,’ Mack said.


Source:
By Curtis Rampersad Business Editor
Trinidad Express
Wednesday, December 9th 2009

http://www.trinidadexpress.com/index.pl/article_business_mag?id=161567876