Government to come to the rescue of CLICO
The Barbados government is preparing to come to the rescue of the collapsed CLICO International Life.
Minister of Finance Chris Sinckler made the disclosure today, saying the embattled insurance company was in need a “small” amount of money at this stage to keep it going.
He also revealed that Cabinet had already given the nod to a restructuring plan prepared by the company’s judicial managers Deloitte Consulting.
“The restructuring plan will be approved by the High Court and will be executed jointly by the Judicial Manager and a new company that is being put in place that Government has established to manage the assets of CLICO in the various trusts that are to be created for such assets,” Sinckler said.
Under the plan it is envisaged that all policyholders with traditional insurance policies, such as life, health and pension plans, will receive the full value of their policies with the support of the Government.
Holders of individual Executive Premium Annuity (EFPA) policies will receive the value of their principal investment while investors with EFPA policies, other than individuals, will receive shares in the property holding entities.
The plan also envisages the creation of a new insurance company (NEWCO) to take over the insurance business and the creation of separate entities that will own the real estate and other illiquid assets.
Deloitte has said that these property-holding entities will issue bonds to the new insurance company, which will be guaranteed by the Barbados Government.