After a long and frustrating eight years of waiting, thousands of policyholders of the collapsed CLICO International Life Insurance Company have finally begun to receive their outstanding claims payments, Resolution Life (Reslife), the company that replaced CLICO, announced today.
And, according to Chief Executive Officer Cheryl Senhouse, Reslife has been making some hefty payments.
“We have commenced payments to our annuitants, those would-be pensioners. On average that bill is about $400,000 per month, and we have provided payments for January and February of 2018,” Senhouse said this morning following a tour of the new company’s corporate centre in Worthing, Christ Church, by Minister of Finance Chris Sinckler.
Senhouse promised that Reslife would remain current with the payments to policyholders as it endeavours to clear the backlog within the proposed six-month timeframe.
While noting that total claims stood at $40 million in 2015, the insurance executive was unable to provide and updated figure as at the end of December 2017, because, she explained, data was still coming in from clients.
She told reporters that while Reslife was still assessing a proposal to renegotiate the reinstatement of lapsed policies, its priority was on servicing those who had stuck with the company and continued to pay their premiums.
“Our immediate priority though right now is to deal with the persons who . . . held on during the time of the judicial management and ensuring that those persons continue to pay their premiums and so on, that they are the ones who immediately are able to reap the benefits of the portfolio coming over to Resolution Life,” Senhouse stressed, adding that in the near future the company would assess the options available to people whose policies had lapsed during judicial management.
She could not say what percentage of the polices had lapsed, but said the attrition rate must be substantial considering the length of time it took to bring closure to the matter.
Senhouse also made it clear that payments would only be made to policyholders and investors whose policies had matured.
“Persons who are going to receive payments at this point in time are claimants. So if someone’s policy matured during the course of the judicial management, if someone died, their beneficiary would receive the payout from the policy. So those are the persons. Any other policies where someone continues to pay their premiums, those policies simply remain in force and if something happens in the future, those persons are immediately able to benefit from the provisions of the policy. So there is not a blanket payout that is going to be coming from Reslife,” Senhouse explained, while emphasizing that Reslife would operate as an ongoing insurance company where claims would be honoured as they arise.
Earlier, the minister had said that annuities, pensions and death claims would be the first to be settled
“From the first of this month, persons have started to receive payments on some of the instruments which they have with the old CLICO which are now being managed by Resolution Life . . . and for that we are also elated that we have reached the stage where finally payments are being made. We are coming good with our promise to make our policyholders whole again,” Sinckler said.
He also apologized to policyholders and investors for the lengthy wait, but explained that some of those matters were beyond Government’s control in that CLICO was under judicial management and was being supervised by the High Court.
Sinckler also assured the new company of Government’s continued backing, noting that this was only part of a wider restructuring of the financial services and regulatory system.
“We are going to help them along the way because we have made substantial changes in the way the regulatory system is done. As you know, we passed the Financial Services Commission Act, we have incorporated many of the legacy bits of legislation under there, including the Insurance Act of Barbados,” the minister stated, while adding that the Financial Services Commission had assumed the functions of the Supervisor of Insurance.
He suggested that the CLICO debacle ought not happen here again if good regulation, “appropriately-operated companies” and public vigilance were maintained.
Meanwhile, Sinckler invited authorities in the Organisation of Eastern Caribbean States with former CLICO portfolios to get onboard with the Barbados plan in one form or the other.
He argued for the commencement of discussions, through the currency union, on whether those countries wanted to adopt the Barbados plan or something entirely different.