Barbados Laments Slow Pace of CLICO Settlement

BARBADOS has expressed disappointment that a settlement has not yet been reached so as to allow policyholders to recoup some of their finances following the collapse of the Trinidad-based regional insurance conglomerate, Colonial Life Insurance Company (CLICO).

Finance and Economic Affairs Minister Chris Sinckler said last December some decisions had been taken which were contingent on the courts’ acceptance of the restructuring plan for CLICO.

“We have put certain things in place, including financial resources, which we have done with the assistance of our Central Bank and others. We have given full and complete support for that restructuring plan to proceed and I can say that six, seven, [or] eight months on, we are in fact disappointed that the pace at which that…reform has transpired, has not been at a satisfactory level,” he said.

Sinckler, addressing the Central Bank of Barbados (CBB) sponsored Domestic Financial Institutions Conference, said he has held talks with the team from the government and the judicial manager in a bid to resolve the issue.

He said a statement will be issued soon and the transition completed by year end.

“I can assure you that in a couple weeks time I will be issuing an appropriate statement on it that hopefully will be done jointly with the judicial managers to indicate the time line for which we have now determined and that transition should be complete and with it, of course, the resumption of the payment of various awards and premiums …that are due to members of the public,” he said.

Sinckler said that in December some decisions were taken, which were contingent on the courts’ acceptance of the restructuring plan for CLICO.

“We have put certain things in place, including financial resources, which we have done with the assistance of our Central Bank and others. We have given full and complete support for that restructuring plan to proceed and I can say that six, seven, [or] eight months on, we are in fact disappointed that the pace at which that…reform has transpired, has not been at a satisfactory level,” he said.

The appointment of the judicial manager is part of the initiative by Eastern Caribbean governments, including Barbados, to recover some of the assets of policy holders with the Trinidad-based CLICO, which is part of the financially troubled CL Financial Group.

CLICO and its sister company, the British American Insurance Company (BAICO) collapsed in 2009 and the Trinidad and Tobago government signed a shareholders’ agreement with then CLICO chairman Lawrence Duprey following the signing of a memorandum of understanding (MOU) between them on January 30, 2009. The MOU gave the government control of 49 per cent of CLICO’s shares.

The then Patrick Manning government injected seven billion Trinidad and Tobago dollars (US$1.01 billion) into CLICO in 2009 to keep the collapsed insurance firm running and protect policy holders.

A few months later, through the passage of legislation in the Parliament, the Kamla Persad Bissessar led coalition People’s Partnership Government committed a further TT$13 billion (US$2.01 billion) to keep the floundering insurance company afloat..