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Monthly Interest for Pensioners

Pensioners with lump-sum, interest-sensitive insurance policies with Dyoll Life, Crown Eagle and Mutual Life, will be able to collect monthly, rather than twice yearly interest cheques under the FINSAC-brokered deal with the Bank of Nova Scotia.

Under the proposal, owners of Mutual Investor Plus, Fortune and Asset Investor policies who accept the offer will have access to the first $200,000 of their money shortly after signing the agreement with FINSAC. Additionally, they would be issued Certificates of Participation for any remaining funds and would be paid tax-free interest twice per year for the 7-year life of the Certificate.

Now, with the decision by Finance Minister, Hon. Omar Davies, pensioners, 65 years and older as at March 31, 1999 have the added benefit of being able to collect interest payments monthly.

"This decision was taken against the background of many pensioners depending on interest payments for their living expenses. With no other source of income, they would suffer severe hardship if they had to wait for 6 months for a payment," Mr. Patrick Hylton, Managing director of FINSAC said.

Recently, in an address to the nation on FINSAC’s activities, Dr. Davies said that the country was not in a position to pay out all investors in lump sum, interest-sensitive policies immediately. However, the vast majority, 6,000 of the approximately 9,000 policyholders, would get full payment under the scheme.

Commenting on the flow of persons going to the insurance companies to sign the agreement since the offer opened on February 24, Mr. Hylton, said that it was slower than hoped with a big rush towards the end of the first tranche of signing.

"Generally, we are a last minute people and so towards March 15, the deadline for signing of accounts to be opened on April 1st, we had a big rush at all the insurance companies," he said.

"Approximately 6,000 persons will get all their money by accepting this agreement, but even these are coming in slowly. We have two more tranches: the current one which ends on April 9 and which will allow accounts to be opened on May 1st, and the final one: April 12 – May 10 for accounts to be opened on June 1st", the FINSAC head said.

"We are certainly hoping that the pace will pick up and that we will not have policyholders pouring in at the last minute."

FINSAC, set up to rehabilitate troubled financial sector companies, stepped up its divestment activities with the FINSAC/BNS initiative and the sale of the portfolios of Mutual Life, Dyoll Life and Crown Eagle. Traditional life, equity linked, group life, non-lump sum interest-sensitive and health policies, as well as, management of the pension schemes have been put to tender. Eight companies are in the running for these portfolios.

 

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