The government yesterday tabled legislation which will see the Bank of Guyana (BoG) taking over the functions of the Commissioner of Insurance (CoI).
The Insurance (Supplementary Provisions) Bill 2009 was read for a first time yesterday in Parliament.
The bill’s explanatory memorandum said that it seeks to pave the way for the BoG to administer the Insurance Act “and for a person nominated by the Bank to be appointed by the court as judicial manager”.
It added “Accordingly, the Financial Institutions Act, the Bank of Guyana Act, the Insurance Act and any other law shall be read and construed with such modifications as to facilitate the functions of the Bank under this Act.”
The amendment legislation comes in the wake of the ongoing CLICO (Guyana) debacle where the company was placed under judicial management after over 50% of its assets became impaired when its sister company in The Bahamas collapsed.
Under the Insurance Act, the Commissioner of Insurance becomes the judicial manager. This provision had been criticized by commentators as it was felt that the judicial manager should be someone other than the holder of the post of CoI.
The judicial management proceedings took a shocking turn after Judicial Manager Maria van Beek survived an execution attempt on Lombard St. She was shot in the chest days after delivering a report on the status of CLICO. She had to be rushed to the hospital for treatment and is now recuperating.
There had been speculation about whether she would continue in that position and the amendment legislation will now take the matter out of her hands.
Clause 4 of the bill says that the central bank “may take legal proceedings or continue any legal proceedings, including making an application to the Court for the appointment of any person nominated by the Bank as judicial manager”.
It was the second major new task to be taken on by the BoG in recent days. Last week it was disclosed that the New Building Society will come under the purview of the BoG in line with the
Financial Institutions Act.
