The Registrar of Insurance Roger Brown says he agrees that his office “lacks sufficient depth of technical support and expertise” as it prepares its recommendation to the government on the sale of Canada Life and Imperial Life to Colina Insurance Company.
Mr. Brown admitted the deficiencies facing his office in a recent letter to the Secretary to the Cabinet, while defending the department’s position regarding the pending Colina purchases.
He was forced to go on the defensive after top insurance executives levied scathing criticisms against his office’s handling of the matter. Their charges were made in a recent PowerPoint presentation to Prime Minister Perry Christie, who has now taken over responsibility for examining Colina’s proposed acquisitions.
Mr. Brown said the comments made by the executives for the most part were “misleading and/or derogatory.”
The executives said the registrar lacks sufficient depth of technical support and expertise concerning protection of policyholders rights and also considering the fact that there are no fair trade laws or legislation concerning protection of minority shareholders interest.
Mr. Brown said his office has recognized its shortcoming for some time and has been trying, but without much success, to obtain the necessary approvals and funding to correct the problem of lack of expertise.
He also accused the executives of lying in their presentation.
“There are two spurious allegations that have been craftily drafted and are thus difficult to address,” Mr. Brown said.
The first allegation mentions “reported irregularities from the Office of the Registrar involving Colina”.
Mr. Brown said, “while I cannot comment on the reported irregularities, I can say that the implication in the rest of the statement is an absolute lie.
“The files will show that when the report was received in this office that Colina General was soliciting business before its licence was approved, letters to cease and desist were immediately sent out. In addition, a meeting was held with the principals of the company and a warning given directly that they must stop whatever they were doing.”
He does not, however, say that this practice has stopped.
The executives also said that, “The behaviour of the Office of The Registrar in several other transactions involving Colina has caused various third parties to express rather uncomplimentary views about the said Office. Details can be presented to authorities under appropriate circumstances.”
Mr. Brown reacted to this charge saying, “while it is most damning, I cannot respond to the statement.'”
But he did say, “I resent and categorically deny the implication that this office has colluded with or has shown partiality to Colina. I have been aware that persons have expressed such views, and I can only hope that those persons who made the allegation will be asked to provide the details to substantiate it. I cannot believe that any of the persons concerned would have knowledge about such matters and not report them to myself or the minister.”
Mr. Brown’s response was to the presentation made by executives of Atlantic Medical Insurance Limited; Bahamas First Holdings Ltd; Fidelity Bank & Trust International Limited; British American Insurance Company; Insurance Management (Bahamas) Ltd.; Sunshine Insurance Ltd; Family Guardian Insurance Co. Ltd; Security & General Insurance Co.; J.S. Johnson & Co. Ltd.; and RoyalStar Assurance Ltd.
They said that regulators should be concerned that a company with an inadequate proven track record as a major industry player will control 70 percent of the ordinary life insurance market.
Mr. Brown said this can only be true if all the proposed purchases by Colina are approved. But he said “as I have noted above, this office is not yet in a position to submit a recommendation on the Imperial Life purchase.”
He said that if all the acquisitions were approved Colina would control 43 percent of the total Life & Health market.
“The use of the potential 70 percent market share statistic is somewhat disingenuous as in the local insurance market the different companies do not sell just one product,” he said.
The Bahama Journal
