Large Investors Signing FINSAC Agreement

Large Investors Signing FINSAC Agreement

Jamaicans with higher sums invested in Dyoll, Eagle Commercial and Mutual Life lump-sum, interest-sensitive policies lead policyholders in coming forward to sign a FINSAC agreement which would see them receiving up to $200,000 now and any remaining balances in 7 years.

Policyholders with more than $200,000 invested make up 21% of the total number of policies but account for 95% of the approximately $2.8 billion value of the portfolio. To date, almost 60% of these policyholders have come forward to sign the agreement. As such they have ensured that their investments totalling some $1.8 billion is secure and continues to earn interest.

However, the picture at the other end of the spectrum is quite different. Policyholders with $20,000 or less make up 60% of policies, but account for less that 1% of the portfolio value or $23,776,851. Only 15% of these with investments totalling approximately $3.45m have come forward to sign the agreement.

Between these two ranges - those with more than $20,000 and up to $200,000 invested - 36% of policyholders have come forward to sign the agreement. Signed up policyholders account for $48.8m of the lump sum, interest-sensitive portfolio or 44% of the total of approximately $111m.

Policyholders began signing the FINSAC agreement on February 24. Two of three deadlines for signing have passed with the final deadline being May 10, 1999. Under the agreement, as soon as policyholders have signed and completed the paperwork, accounts will be opened in their names at the Bank of Nova Scotia and up to $200,000 made available very shortly afterwards. Certificates of Participation would be issued for any remaining balances on which interest will be paid at BNS passbook rate twice per year.

The exception to this is that monthly interest payments will be made to pensioners who were 65 years and older on March 31st. 1999, a decision taken by the Minister of finance in response to the fact that many pensioners depended on interest payments for their daily expenses.

April 20, 1999