Alternative insurance offered for BAICO policies

| 30/09/2009

(CNS): Homeowners who hold a property insurance policy with troubled insurance agent British American Insurance Company (BAICO) Cayman, now have a way to continue insuring their homes this hurricane season. The controllers of BAICO, Simon Whicker and Kris Beighton (left) of KPMG, concluded an arrangement with Island Heritage Insurance last week that will ensure that all BAICO Cayman’s existing property insurance policyholders continue to have property insurance cover in place at this high risk time of year.

BAICO was placed in the hands of the KPMG accountants by the Cayman Islands Monetary Authority (CIMA) earlier this month in a bid to protect the assets of the company for policy holders. This followed a cease and desist order by CIMA in June prohibiting BAICO from issuing any new insurance policies of any kind.

KPMG said that, under the arrangement, all existing property insurance policyholders of BAICO Cayman have been offered new property insurance cover by Island Heritage Insurance on substantially the same terms as they had previously.

This swift action was taken following the Controllers being informed on Monday, 21 September, that a substantial element of BAICO Cayman’s property reinsurance cover had been cancelled by a major reinsurer. This meant that BAICO Cayman was no longer able to offer effective property insurance. In light of the potential exposure to BAICO Cayman and, in turn, to its policyholders, the controllers took immediate steps to protect policyholders’ interests.

Under the terms of BAICO Cayman’s property insurance policies, policies may be cancelled by BAICO Cayman or policyholders by giving seven days’ notice. Letters were sent to all BAICO Cayman’s property insurance policyholders last week, explaining the decision to cancel their insurance and providing them with instructions for continuing property cover with Island Heritage Insurance.

In addition, policyholders’ agents are continuing to contact all policyholders to explain the details of the arrangement that has been put in place. In order to receive immediate property cover from Island Heritage Insurance, all policyholders need to do is to visit either the BAICO Cayman offices or the Island Heritage Insurance offices, where they will receive immediate cover upon signing a new policy and paying the first instalment of their premium. Should policyholders be due a refund in respect of any unused portion of their premium paid to BAICO Cayman, this will be repaid to them by BAICO Cayman.

Anyone who holds a property insurance policy with BAICO Cayman who has not yet acted is urged to contact their local agent or the BAICO Cayman office, immediately.

Joint Controller Kris Beighton said, “The difficulties arising from BAICO Cayman’s reinsurance situation on the property book meant we had to expedite a substitution process to an alternative insurer for this line of business to prevent significant exposure to our policyholders. We’re obviously delighted that, through our working relationship with Island Heritage Insurance and the Judicial Manager of BAICO in the Bahamas, and the significant assistance and support of CIMA, we have managed to effect an immediate solution to provide protection to our local policyholders.”

Now that BAICO Cayman has transferred its property insurance portfolio, the controllers of BAICO Cayman are working with potential acquirers of the remainder of the BAICO Cayman business and hope to be able to make furtherpositive announcements in the coming days or weeks.

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Comments (10)

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  1. Anonymous says:

    What you fail to understand is that Island Heritage STEPPED UP. Any one of the BAICO policy holders can go to any insurance carrier they want but as the board member of one of the Strata’s affected, the problem came when NONE of the other insurance carriers on island would accept a monthly payment plan. They all wanted 70% of the premium UP FRONT. Let me tell you we would have no other option but to try and take out a loan, double strata fees and THEN shop around to get the best deal. There was NO time for all of that.

    So, my two cents, Kudos to KPMG,  Island Heritage, CIMA and those agents still working on behalf of BAICO. Thank you for making sure we all had a VIABLE option to continue our coverage! Bless you all for watching out for us during this hurricane season!

    A thankful Caymanian!

    • Anonymous says:

      I totally agree with you, thank God they came to our rescue. They were the only insurance company that was willing to work with us and not be greedy!

      • Anonymous says:

        Obviously you guys really don’t do your homework, most, if not all insurer’s in Cayman including the brokers/agents offer payment plans.

        Now if you are telling me that Island Heritage are matching the existing rate that you have, then ok, that is one concession on their part.

        • Anonymous says:

          Yes most do, but what sort of payment plan……half of the premium now and the balance over three (3) months…..well if you can afford that good for you, I sure can’t with what is going on now in the world. If you have a $9000 annual premium you would have to pay half which is $4500.00 and then $1500 for three months, most average working folks would find thatsort of arrangement a strain.

          • Amazed says:

            Well I know of at least one insurance provider that as standard gives far better terms than you all are alluding to. Do your research properly next time before misleading Readers!!    : )

            Terms for payment plans spreading the cost over 6-10 months ARE out there if you approach the right companies. Deposits are likely to be less than 30% with some, so the contributor who said the best they could get was 70% is either approaching the wrong companies or there’s something unique to their situation why they can’t get anything better.

            You CAN get good terms; just need to speak to the right companies & listen to their radio ads!!!

          • Amazed says:

            You guys must be approaching the wrong companies. I know of one that offers payment plans interest free over 6-10 months, with low deposits. They aren’t BAICO or Island Heritage, but I’m not going to name them as it’s up to them to advertise, & I’m not here for that.

            Maybe you’ve had a poor record so can’t get better terms, but most people should be able to.

            Do your homework in future before misleading others!

          • Anonymous says:

            Let’s see, as far as I can think, we have four insurance companies, Island Heritage, British Caymanian, Sagicor & ICWI. The rest seem to be brokers or agents for insurance companies not here in Cayman. So if comparing apples to apples, you are telling us that out of the four named insurance companies, Island Heritage is the only one to offer monthly payments. This my friend is incorrect information. I personally pay insurance monthly over 8 months and was not required to come up with 50% down nor was that requested at other insurers that I had quotes from.

  2. huh.. says:

    Idon’t understand why they are sending them to one particular insurance company …perhaps they are stepping outside of there role as controllers and acting in the capacity of a agent/broker..Perhaps CIMA should investigate as this is clearly against the Insurance Law (2007 Revision)

    Just a thought

    • N Sure says:

      Probably an agent or broker more interested in feasting on fees after the BAICO collapse than someone genuinely interested in the policyholders.

    • Anonymous says:

      To Just a thought – why is it that there is always someone out there being negative. These people are only trying to get help for those of us who could possibly be left without insurance coverage and to protect us – they obviously did not have much time to play with to get all of us covered and are doing the best that they can considering that we are still in the middle of hurricane season. I am sure those of us who are insured with them are not stupid and know that we are not obliged to take any deal from Island Heritige if we do not want to – we are free to look else where if we choose all the liquidators are doing is ensuring that we have coverage if we want to go with Island Heritage. I did and got the same price and a great monthly terms thank you.