There could be some good news for Montserrat residents and businesses who have invested in the Colonial Life Insurance Company (CLICO). This is according to news originating from CMC (Caribbean Media Corporation) and published in the Jamaica Gleaner of February 26, 2014.
The Governor of the Central Bank of Barbados, Dr Delisle Worrell, says a cooperative solution has been found to settle outstanding Colonial Life Insurance Company (CLICO) claims in Barbados and the Eastern Caribbean.
He told the Caribbean Media Corporation that the latest report from the judicial manager made to the Barbados court provides a way forward which seems fair to all stakeholders.
“What it says is that you may not be remunerated for interest that you might have accumulated, but we will at least ensure that you get a product which restores the principle value of what you might have invested with the company,” Worrell said.
Annuity payments
He said individuals would be entitled to some annuity payments on maturity, which they could cash out but with a penalty, while in the case of institutional investors, a company will own those assets, which will go on sale over time.
“Institutional investors will get shares in that company and as the assets are sold, then they will be paid their principle amount,” he added.
The central bank governor said the authorities were taking that route because insurance companies are now restricted in their ownership of property and income-generating assets.
He said the principle reason for the delay was to ensure that the new plan could be applied equally in Barbados and OECS and to ensure that all of the territories were on board.
The problems facing the Barbados economy are unlikely to affect the plan because the contributions the Barbados government would be required to make are manageable, said the central bank chief.
Barbados Finance and Economic Affairs Minister Chris Sinckler last month said that many of the cabinet papers have been completed and submitted regarding the approval of the formal and final restructuring plan for CLICO.
“We expect thereafter the judicial managers will shortly … indicate to the courts that the government has thrown its full support behind the restructuring plan which was identified when they last went to the court and had tentative approval for it,” Sinckler said.
Eastern Caribbean governments appointed a judicial manager in March 2011 to recover some of the assets of policyholders of regional insurance company CLICO, which is based in Trinidad.
CLICO and its sister company, British American Insurance Company, collapsed in 2009. The companies and their parent operation CL Financial Group were taken over by the Trinidad & Tobago government.
The then Patrick Manning government injected TT$7 billion (US$1.1b) into CLICO in 2009. Later, through the passage of legislation, the Kamla Persad-Bissessar government committed a further TT$13 billion (US$2.01b).
