In a positive move for policy holders with British American Insurance Company Cayman, the administrators of the insurer concluded an agreement with BAF Insurance over the acquisition of all assets and liabilities of BAICO for an undisclosed sum.
The controllers, Simon Whicker and Kris Beighton of KPMG, said the sale would protect the interests of thousands of BAICO Cayman’s policy holders from the risk of losing their existing coverage.
‘This is a really great result for Cayman,’ said Mr. Beighton.
‘The interests of the policy holders and pension plan members will be safeguarded by this deal and the opportunity exists for a notable local business to survive and prosper and thus continue to provide employment.’
The sale covered the assets and liabilities of BAICO’s health insurance, life insurance and pensions business.
The Cayman Islands Monetary Authority issued BAICO with a seize and desist order in June and put the insurer under receivership in September after its financial and operational situation had deteriorated.
The acquisition of BAICO Cayman by BAF, a Bahamian insurer, has been approved by CIMA, the National Pensions Office, the Grand Court of Cayman and the Supreme Court of the Bahamas. It was also supported by the Health Insurance Commission.
The sale takes effect immediately and the business operations will be transferred to BAF over the next few days. At the same time pension plan members and policy holders will be notified in writing of the change of ownership.
CIMA’s managing director Cindy Scotland welcomed the sale, saying it ‘meets the objectives that CIMA had in placing BAICO into controllership’.
She added: ‘It will safeguard the investments of policy holders and creditors, ensure the institution has a firm financial base with sound management and control and preserve jobs. This is the best possible outcome and we look forward to a continuing proactive relationship with the new owners, in the public interest.’
The National Pensions Office also welcomed the acquisition. ‘The National Pensions Office welcomes BAF Insurance Company to the Cayman Islands as the new Administrator of the British American Guaranteed Pension Plan,’ said NPO acting superintendent Amy Wolliston.
‘We assure all pension members that we have worked closely with BAF over the past weeks to ensure that members’ pension benefits are fully protected,’ she added.
BAF Insurance Company is owned by holding company BAF Cayman, which itself is part of BAF Global Group, a Bahamian finance and insurance company.
Chester Cooper, CEO of BAF Global Group commented on the group’s first international acquisition, saying that it is a strategic move to enter Cayman and expand in the region.
He stated that BAF Global Group expects growth, synergies and improved economies of scale from its new business in Cayman.
In terms of business lines, he sees significant group potential on the pension side. ‘We certainly expect good growth from the pension investment business and we are mindful that we are going to protect and continue to preserve the core of the business,’ he said.
BAF Insurance Cayman appointed the former head of BAICO and 40-year industry veteran Harvey Stephenson as chairman.
Jason Borrino has been appointed as managing director of BAF Insurance Cayman.
With regard to the direction the new company will be taking, Mr. Borrino said: ‘Life insurance, health insurance and pension plans will continue to be our core business. In time, backed by the extensive experience and resources of the BAF Global Group, we will introduce many more exciting products and services.’