The Tribune

By KHRISNA VIRGIL

Deputy Chief Reporter

kvirgil@tribunemedia.net

THE Christie administration has already paid $11m to CLICO (Bahamas) policyholders and intends to hand out an additional $38m in bonds, State Finance Minister Michael Halkitis told Parliament yesterday.

He said payouts were ongoing to around 300 people who did not receive money during the initial disbursement phase from March 1 to June 30 this year.

During this time, Bahamians who made claims received around 3,389 cheques, Mr Halkitis said.

The government, he said during an update in the House of Assembly, expects to make the final set of payouts in January.

“Mr Speaker as you know, the government made a commitment to resolve this matter and the first payout of the policies during the period of March 1, 2016 to June 30, 2016, approximately 3,389 cheques totalling just over $11m were issued,” Mr Halkitis said during the second reading and committal of an amendment to the Insurance Act to facilitate the National Health Insurance plan.

“These payouts were for policy holders of record as of February 29, 2016 who had surrendered policies claims and annuities.

“Policy payout, Mr Speaker you would recall for each policy holder, was a maximum of $10,000 per policy holder and many, Mr Speaker, were less than $5,000.”

He continued: “There were some individuals, for several reasons, who were not included in that first payout. As far as I know approximately 300 of them.

“For example, they may have been left out because they did not provide the necessary information at the time to enable them to be paid out. That payout is ongoing as we speak.

“The final payout, we expect to take place in January 2017 subject to the approval of the Insurance Commission and we expect that final payout to be in the region of approximately $38m. We had anticipated it early, but as it were with many things a slight delay was caused by Hurricane Matthew. This amount will be dispersed by government bond to policy holders and not cash.”

Mr Halkitis said liquidator Leno Corporate Services and other professionals are completing a business plan and funding structure for a new insurance company named Coral Insurance. It will not take on new policies, but only handle active CLICO policies.

“Mr Speaker, we at the Ministry of Finance are currently evaluating proposals received from entities that have expressed interest in managing the insurance portfolio of Coral. Once selected, the manager and new board of directors have been selected along with the business plan that is being presented to the Insurance Commission for approval. We expect that to be complete by January so the payouts can be made. Of course it’s a very detailed process.”

Standing on a point of clarification following Mr Halkitis’ communication, Long Island MP Loretta Butler-Turner questioned whether the policyholders would receive bonds or cash. She argued that the Christie administration promised money and not bonds as reimbursement.

She also questioned whether Coral Insurance was a special purpose vehicle (SPV).

However, Mr Halkitis maintained that the government had always promised bonds to those who were owed more than $20,000, adding that plans were underway for the bonds to be converted to “liquid cash”.

He went on to insist that Coral was in no way an SPV.