Grenada and other Caribbean countries have been severely affected by the financial problems plaguing the Trinidad-based conglomerate, CL Financial, the parent company of BAICO and CLICO, resulting in the loss of millions of dollars to policy holders.
Finance Minister Nizam Burke told legislators that the Eastern Caribbean Currency Union (ECCU) member countries are continuing to pursue support from the Trinidad and Tobago government that has pumped billions of dollars as part of a rescue plan for CLICO policy holders in that country.
Burke said that the support is being sought from Port of Spain for non-traditional policyholders including policyholders with Executive Flexible Premium Annuities (EFPA).
“It must be noted that BAICO’s Judicial Manager has commenced legal action against CL Financial and instituted separate action against directors of the company including Lawrence Duprey,” Burke said as he delivered the 2012-13 national budget on Friday.
“In respect of CLICO, the Judicial Manager of CLICO International Life Insurance Limited has now received several expressions of interest for the sale of the company. He will seek to conclude the sale within the next five months, subject to necessary Court and regulatory approvals,” Burke said.
He told legislators that the Tillman Thomas government here is “keenly aware of the hardship that policyholders of BAICO and CLICO are experiencing” adding that from the “outset, we have asserted that this is a regional problem that requires a regional solution.
“Grenada continues to play a key role in this regional solution. We are making progress on the recapitalisation and sale of BAICO’s traditional business which includes Universal Life; Whole Life; Endowment, Term and Group Pensions”
He said bids have been received from potential buyers and are now being assessed.
“We anticipate that the sale which requires Court and regulatory approvals will be finalized in the third quarter of this year,” Burke said, noting that this sale will benefit two out of every three of BAICO’s policyholders.
“In the case of Grenada, 4,725 traditional policyholders will have their policies fully secured. The sale of the traditional portfolio will also benefit non-traditional policyholders since these policyholders will receive a greater share of the BAICO estate in its final distribution,” Burke told Parliament.