in best interest of policyholders’
The Office of the Commissioner of Insurance yesterday moved to clear the air on the CLICO Guyana issue, in the light of “misleading and misinformed comments currently being made on the matter…”
In a press release issued through the Government Information Agency (GINA) yesterday, Com-missioner of Insurance Maria van Beek noted that as regulator of the insurance sector, the commissioner has a responsibility to act in the interest of the long-term stability and strength of the sector and in particular in the interest of policyholders and the public.
The release said that after van Beek had ascertained the extent of the exposure of CLICO (Guyana) to overseas investments, she immediately instructed the company to correct this deficiency. According to the release, “the company undertook to do this in a manner that would be orderly and that would avoid undue dislocation to its operations, which would in any case have been harmful to the interests of policyholders.”
The statement said that it would not have been appropriate for the commissioner to opt for judicial proceedings at this stage because any attempt to obtain the intervention of the court would have required a demonstration that the company was unable to meet its local liabilities, “a condition that was not threatened until very recently. Indeed a move to the court or any other public pronouncement on this matter at that stage could very well have precipitated the demise of the company to the immediate detriment of policyholders.”
The commissioner continued to urge the company to repatriate a greater share of its investment portfolio, and began discussions on other options that might be available, including that of having the real estate holdings in Florida that was owned by another member of the CLICO Group, assigned to the local company. The statement explained that while these options were being explored, the Bahamian regulators moved to that country’s court and obtained an order for the winding up of that company on February 24.
The following day, the commissioner moved to the local courts and obtained an order to place CLICO (Guyana) under judicial management. The move by the Bahamian regulator to wind up its operations in Bahamas was the external development that triggered the need for judicial protection of policyholders in Guyana and this protection was obtained within a day.
The commissioner said she has been closely engaged with the company for an extended period in an effort to resolve any imminent difficulties, and this was being done in a manner that placed the interests of policyholders and the public above all other considerations.
Meanwhile, the commissioner reaffirmed the assurance already given by President Bharrat Jagdeo that all polices held in CLICO (Guyana) will be protected. In this regard, the Office of the Commissioner of Insurance will be communicating with policyholders within two weeks. The statement also said that “the interests of the staff of the company would likewise be safeguarded and their cooperation and support will be essential in ensuring the successful resolution of the current situation.”
The commissioner issued a call for all interested parties to allow the processes provided for under the Insurance Act and mandated by the court to be executed efficiently and without the distraction and unhelpful consequences of reckless, uninformed and irresponsible pronouncements on the matter.