Court orders CLICO to repay millions to policy holders

PORT OF SPAIN, Trinidad, (CMC):

A High Court judge has ordered the financially troubled Colonial Life Insurance Company (CLICO) to repay an nearly TT$60 million (US$10 million) to six policy holders.

In a 51-page ruling on Friday, Justice Maureen Rajnauth-Lee ordered that in addition to the TT$58.7 million (US$9.7 million) to be paid to the six CLICO Executive Flexible Premium Annuity (EFPA) policyholders, the company must also meet legal costs estimated at more than TT$1 million (US$166,660)).

But the High Court has also granted a 42-day stay on the ruling since CLICO indicated it will be appealing Rajnauth-Lee's ruling.

The six had sued for the return of money which they invested in CLICO.

The policyholders in their suit claimed the policies were merely contracts in the nature of deposits and not EFPA investments, and became due some time ago. They said they wanted to utilise their policies as investment/savings mechanisms.

In the claims, the policyholders signed an annuity application form and paid money in the claims as deposits/contributions. CLICO then issued certificates for the EFPA agreements.

But CLICO argued that the policies were for an annuity, and the annuity became due at the retirement age stipulated in the policy.

The insurance company, whose financial problems have sent shockwaves across the Caribbean, also argued that by asking for their money, the EFPA policyholders surrendered their policies of insurance before the stipulated retirement ages.