Top insurance companies merge April 1st
Never mind that all over the world big companies are coming together to get even bigger…in Belize merger mania has never really caught on. But things may be changing. This week the country’s two largest insurance companies, Regent and F&G, announced that come April first they will become one, joining forces to create a new company called RFG Insurance. This morning the heads of the two insurers sat down with News 5’s Stewart Krohn to explain the implications of the merger.
Anthony Flynn, CEO, Regent Insurance
?We need to merge for both defensive and offensive reasons. The initiative from the Caribbean Single Market will put pressure on our domestic market. So the defensive part of our strategy is coming together. We are stronger, leaner and much more able to face the competition that will come eventually. The second part which is offensive is once we are up and running–and this will probably take us between two or three years–we will have the size where can look outside for opportunities to expand.?
Christopher Roe, CEO, F&G Insurance
?It gives us a footprint or a volume that allows us to go into the reinsurance market, which is terribly important for our business and be able to get the best prices from the best people in the insurance market. It also allows us to invest in technology; gives us the volume that allows us to invest in technology and therefore become more efficient.?
Stewart Krohn
?We understand that this merger is no doubt good for your two companies. But tell me why is this merger good for the Belizean consumer??
Christopher Roe
?Basically your Belize Insurance market is driven by the reinsurance market. We are as good as the reinsurance that we can get. That is a matter of going outside and buying reinsurance. With a bigger volume we would be able to–as I mentioned before–be more competitive in how we buy reinsurance and the quality of reinsurance we buy. And likewise, that price saving and stuff can result in more competitive pricing and stuff to the local buyer.?
Anthony Flynn
?Christopher and I started talking about this fourteen months ago and it?s been a long but very interesting process. I had three criteria to go forward on this. It had to be good for my clients; it had to be good for my staff and it had to be good for Belize. When I saw that it was go for all three then we really went for it.?
Stewart Krohn
?With the country?s two largest insurance companies coming together that?s got to affect the competitive situation in the country. Should we fear that the creation of this new insurance company is going to lead to a monopoly situation??
Anthony Flynn
?At the moment there are thirteen registered insurance companies licensed to operate in Belize. When the merger goes through this will reduce from thirteen to eleven. So the word monopoly cannot be used.?
According to Flynn and Roe, no staff reductions are planned, although some employees may be retrained to take on different responsibilities. The merged company is expected to move into a new headquarters building on Coney Drive by the end of the year.
