BIPA ready for court

PEOPLE HOLDING CLICO and British American Insurance Company (BAICO) policies are gearing up for a round of court hearings that could signal the end of a five year fight for compensation.

Last Wednesday the Barbados Investors and Policyholders Alliance (BIPA) selected separate committees to continue the work on the two cases, amidst reports that a judge had been assigned to the case and policyholders could be days away from the start of the court process.

Each committee consists of about five policyholders and reflects the variety of investments – including life insurance, pensions and Executive Flexible Premium Annuity (EFPA) policies – in the two businesses, whose problems worsened in 2009 when parent company CL Financial started its meltdown.

Selection of the committees was finalised at a BIPA meeting held in the Ann Johnson Auditorium at St Gabriel’s School, with BIPA president June Fowler saying that once the agency and its committees were accepted by the court as part of the judicial process to resolve the CLICO/BAICO problems, BIPA would be the only representative for all the policyholders, whether members of the alliance or not.

“Any decisions that are made by us will affect everybody else,” she told the gathering.

Representation

BIPA officials are of the view that at this point both the CLICO judicial manager and any judge assigned to the case would want to open the door for them, the argument being that a judge would want to know that the policyholders were properly represented and when he was making an order he had some comfort that the policyholders had had their input.

BIPA officials anticipate a series of court hearings that would address competing claims for compensation – including those from corporate and other investors.

The BIPA meeting came Cabinet’s formal approval of the terms and conditions associated with the restructuring of the local operations of CLICO International Life Insurance Ltd (CIL).

Information coming out of the meeting indicated that the CLICO case might be closer than the BAICO matter to settlement.

However, BIPA is seeking clarity on a number of issues, including interest rates in relation to annuities and details about NEWCO, a new insurance company to take over the CLICO insurance business, as well as about separate entities which will own the real estate and other illiquid CLICO assets.

BIPA is also expected to look at finding “mechanisms for early cash”, to ease people urgently needing substantial sums and the elderly who do not want to wait long periods for their investments to mature.

The BIPA meeting was addressed by Alair Shepherd QC and Peter Douglas, advisors to the alliance. (TY)

Weekend Nation Friday June 6th 2014