by Neville Clarke
The long wait is over for scores of Barbadians owed millions of dollars by insolvent British American Insurance Company (Barbados) Limited.
In recent days, Barbados TODAY investigations revealed, policyholders have been receiving cheques accompanied by letters after the Barbados High Court “ordered” Judicial Manager KPMG Transactions and Restructuring Limited to make the payout.
Sources said the monies to be disbursed could be at least $4 million and were for health, personal accident and property claims made after the Judicial Manager’s appointment in October 2010. The wait, however, continues for BAICO’s life insurance policyholders and those with pensions.
Policyholders were notified of this development this month in letters sent by KPMG TRL representative Lisa A. Taylor.
In a copy of the August 9, 2013 correspondence obtained by Barbados TODAY, Taylor said after the Judicial Manager sought the court’s directions on April 23, 2013, it “ordered that all valid post-appointment claims which have been assessed and classified as outstanding and payable by BAICO are to be settled in full”.
The document captioned British American Insurance Company (Barbados) Ltd – In Judicial Mangement (BAICO) – Health, Personal Accident and Property Policies – Settlement of “post-appointment claims” stated: “In the Judicial Manager’s last correspondence it was set out that due to BAICO’s financial difficulties BAICO could no longer provide effective coverage under its Health, Personal Accident and Property Policies and as such the Policies were to be cancelled.
“The Judicial Manager indicated that steps had been taken to provide alternative arrangements for the protection of policyholders and an offer was made of substituted coverage with Sagicor General Insurance Inc. and Sagicor Life Inc.
“It was further indicated that those claims which were received after BAICO was placed into judicial management (the post-appointment claims) would remain BAICO’s responsibility and would not be transferred to Sagicor.
“Since then KPMG Transactions and Restructuring Limited, as Judicial Manager acting through Mrs. Lisa Taylor and Mr. Michael Edghill, have been working on the treatment of premiums and the settlement of the post-appointment claims.”
Thanking affected policyholders for their “patience and understanding in this matter”, Taylor directed them to “the enclosed cheque and accompanying explanation of benefits as settlement for your post-appointment claim”.
This development is a major one for many Barbadians who have been waiting three years to have claims settled.
One of these individuals, who spoke on condition of anonymity, told Barbados TODAY: “I was patient and I am extremely happy to see the end result of my patience. In the first instance the company was saying it did not know how it would turn out, but the action of the government was measured, forthright and successful up to this point.”
Immediate past Judicial Manager representative David Holukoff had previously said that those policyholders now receiving funds were unlikely to get the value of their full claims because of BAICO’s insolvency.
The Judicial Manager had asked the court for direction on the payment of claims in 2011, and had said that the Office of Supervisor of Insurance and Government by extension had failed to meet a request to provide funds to meet the cost of policyholder health claims, which then amounted to almost $1 million of an overall $3.4 million in agreed but unpaid monies.
At a hearing on July 25, 2011, the court ordered that premiums received after the Judicial Manager’s appointment were to be held in constructive trust by the Judicial Manager on behalf of contributing policyholders.
On that occasion the premiums received were $8.6 million and would have increased since then. This was in addition to a $10.8 million cash balance. While the court’s recent decision is good news for BAICO’s health, personal accident and property policyholders, those with life insurance policies and pensions will have to continue their wait for a resolution.
Having taken over these business lines from BAICO a year and a half ago after forging a court-approved insurance substitution agreement with the Judicial Manager, Sagicor is currently engaged in negotiations to purchase the life insurance and pensions business lines. [email protected]
Millions of dollars owed to British American policyholders to be repaid - by Barbados Today August 22, 2013 Article by
Barbados Today Published on
August 22, 2013
August 22, 2013
by Neville Clarke