Overseas customer questions JN over insurance coverage

TELL Claudienne

Claudienne Edwards

Sunday, March 18, 2018

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Dear Claudienne

I am writing this letter to express my disgust with Jamaica National Building Society Bank (JN Bank) and JNGI (JN General Insurance).

I reside in the United States and took an $8-million home loan (mortgage) from JN Bank. In negotiations for the loan I was told that the package would include homeowners' insurance through JN General Insurance, and life insurance on the loan. I did not get the option to shop for my own insurance.

While the property was under construction JNGI insured the property for $15.8 milion and I was required to pay a premium of $8,437 per month. Construction of the house was completed in 2016.

In December 2017 my premium was increased without notice. When I contacted Jamaica National I was told that a new valuation done on the property had increased its value from $15.8 million to $28 milion and that the new monthly premium would be $15,430 monthly.

When I inquired from a customer service representative if I could move my insurance to another company I was told that I could use only “JN-approved insurance companies”. The three companies they approve are ICWI, Guardian, and Advantage General (must be for commission purposes).

A month later on January 13, 2018, I was sent a renewal notice that stated that the insured amount on the property had been increased to $30,635,315.15 and that the new monthly premium would be $28,254.66.

I contacted the person who had processed the loan initially and was told that the quote was based on the reconstruction cost of the valuation report. I contacted JNGI and was then told that it was only an “estimate” and no valuation report was done to substantiate this hike in premium.

Nowhere on the renewal notice did it state that it was an estimate nor that I could shop for my own insurance.

My issues are:

1) Is it not illegal for JN to choose the company to carry homeowners' insurance for my property?

2) Why am I being charged on a replacement cost of $30,635, 315. 15 when a valuation has not been done on the property in over two years? And why am I getting charged on the total replacement cost when JN should have carried their own insurance on the $8-million loan that I took from them?

3) Why is JNGI's rate significantly higher than the other insurance companies in Jamaica, as other companies have now given me quotes for half of JNGI's quote?

4) Why doesn't JN Bank inform clients initially that they can shop and buy their own insurance? It is not right to only want the parent company to carry your loan coverages.

5) It is my belief that this scheme is only geared towards international loan holders and if that is the case it is unfair. Someone needs to look at JNGI's international policyholders' contracts and compare them to locals' policies with similar coverage.

It seems that because international policyholders are not in the country to query their policies, JNGI and JN Bank team up to take advantage of these customers.

I need the insurance manager from JNGI to either lower my policy to a comparable rate or for the JN bank to give me a written explanation as to why I cannot transfer my coverage to another insurance company.


Dear SE

Tell Claudienne contacted JN Corporate Communications and received the following e-mail from a spokesperson at the Ombudsman Executive Member Relations and Quality Assurance JN Group:

“On February 20, the JN Group Member Ombudsman's Office became aware of the concerns of a JN Bank mortgage customer about homeowners' insurance offered through JN General Insurance Company (JNGI). The office launched an investigation into the loan history to identify the facts related to the case.

“The matter has been reviewed and JN Bank and JNGI are now working with the customer to ensure that she benefits from a policy which provides the best coverage possible while protecting the bank's interest in the property.

“JN Bank offers members the opportunity to choose their insurance provider from a panel of providers, on the condition that the mortgagor pays their insurance premium through the bank, as a part of their mortgage payment. Therefore, insurance coverage by JNGI is not mandatory, and we regret that the customer was not advised regarding this choice.

”The peril insurance policy protects both the borrower and the financing company in a mortgage agreement. We aim to secure the interests of our members and encourage mortgage holders to review the specific circumstances related to their property and ensure coverage is appropriate. Periodic valuation reviews submitted to the insurer by property holders will ensure adequate coverage for the property owner's investment.

“JN Bank will be responding directly to the customer to address her concerns and to see how best we can work to meet her needs.”

When Tell Claudienne spoke to you on Thursday, March 15, 2018 you said that JN had contacted you. However, you said that they had not responded to certain clarifications you requested. “Neither have I seen the $90,000 they promised to refund to my account for the two years of overcharged amount,” you stated.

You said that your e-mail requesting the clarifications stated as follows:

“Thanks for the attached documents.

Unfortunately I am still not in receipt of a letter outlining the coverage.

I would like to know:

(1) What's covered under the policy, ie, fire, flood, earthquake...etc.

(2) The yearly new insurance premium.

(3) Breakdown of monthly payment amount including mortgage amount, insurance premium, life insurance, etc.

“Also, my roof is 'Deca Tiles' not shingles.

Does my insurance cover fixtures, ie, tiles, cupboard, lighting fixtures, etc?”

We discussed with JN this latest e-mail to Tell Claudienne and the JN Group Ombudsman office responded as follows:

“We have an active investigation underway with respect to this specific case. We are having extensive discussions with the member and with the JNGI team in an effort to ensure all is resolved. SE requested a copy of her policy on March 13, and received same on said date. The perils covered in the policy are outlined on page 12 of the document.

“As we have indicated, we are working with the member, JN Bank and JNGI to ensure there is full and amicable resolution to the issue.”

Please let Tell Claudienne know the outcome of your discussions with JN.

We wish you all the best.

Have a problem with a store, utility, a company? Telephone 936-9436 or write to: Tell Claudienne c/o Sunday Finance, Jamaica Observer, 40-42 1/2 Beechwood Avenue, Kingston 5; or e-mail: . Please include a contact phone number.

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