Facing mounting concerns that his company’s recently announced acquisitions would lead to a monopoly in the insurance industry, Colina Insurance Company President James Campbell went on the defensive Wednesday.
Mr. Campbell, in a press conference at Colina’s Village Road office, also lashed out at the Bahama Journal regarding an article published in this paper last Wednesday, revealing Colina’s practices in some of its acquisitions.
Threatening a legal suit, he told reporters that should the Journal refuse to extend a public apology to Colina for the article, his company would proceed with its plans to take legal action.
Under the headline “Insurance Companies Raided”, The Journal reported that several large insurance companies and financial analysts had expressed the view that it was not in the national interest for Colina to be allowed to purchase Imperial Life Assurance Company.
Soon after Mr. Campbell’s press conference Wednesday, Wendall Jones, CEO of Jones Communications, the Journal’s parent company, issued a press release.
Mr. Jones said, “So far, based on the information in the Journal’s possession, this paper sincerely believes that its report was entirely correct. The Journal, in its 16 years of service to the Bahamian people, has never sought to impugn the integrity of anyone or any entity. In fact, we frown on yellow journalism and sleaze.”
Speaking candidly with the media, Mr. Campbell indicated that based on the advice obtained from his company’s lawyers, the apology must be published in a prominent position in the newspaper and other news dailies of their choosing.
The apology he added, must also be “clearly acceptable” to both Colina and its principals.
“Should the Bahama Journal fail or refuse to agree to an apology within seven days effective today (Wednesday), then our lawyers have been instructed to initiate proceedings against them for damages of libel and interference of contractual relations” Mr. Campbell stressed.
Mr. Campbell pointed out that should legal action begin, the Bahama Journal would be also be required to disclose the name and address of the actuary and the financial analyst who provided the information on which the article was based.
“We will bring proceedings against those persons as well as libel and interference with contractual relations,” he said.
According to Mr. Campbell, the article has damaged both Colina and its principal shareholders’ reputation, while also subjecting them to “public hatred, contempt and ridicule.”
“In addition to defaming the good name and reputation of Colina and its principal shareholders, the article was written for the purpose and intention of interfering with Colina’s agreement to acquire the insurance portfolio of Imperial Life Financial,” he said.
“The intention of the article was clearly to hopefully persuade the Minister responsible and Cabinet not to approve the acquisition, but rather to be influenced by the unsubstantiated and false statements in the article.”
But Mr. Jones said, “The Journal is simply asking the principals of Colina to show how it is wrong in the report presented last Wednesday on the company.”
He said his newspaper has absolutely no difficulty in apologizing when it is wrong.
Meanwhile, attempting to set the record straight regarding his company’s financial viability, Mr. Campbell said, “Colina is able to effectively acquire the Canada Life portfolio from its own resources,” he told reporters.
He added, “Should it get approval for the Imperial Life acquisition, it is intended that the company will use a combination of its own resources and preference share offerings. This is not withstanding the fact that internal resources exist for Colina to fund both of these acquisitions, given the guidelines and standards we have established.”
He said the fact that Colina has the level of capital adequacy along with financial solvency and a shareholder equity position of some $41 million makes the acquisitions all possible.
His company has also announced that it is acquiring Global Life and Sagicor, formerly Life of Barbados.
According to Mr. Campbell, all of the necessary requirements have already been submitted to regulators with regards to the Canada Life acquisition, leaving the approval now directly in the hands of regulators and the government.
Meanwhile, all the requirements for the Imperial Life acquisition, he added, should be in the hands of regulators and the government sometime this week.
Mr. Campbell previously told reporters that if the acquisitions are approved, his company would control nearly 50 percent of the life and health insurance market. It would also result in Colina having as asset base of $350 million and more than 70,000 in life and health policies.
While Minister of Financial Services & Investments Allyson Maynard-Gibson could not say whether controlling such a large portion of the market would be monopolistic, she has assured that regulators would not grant approval to any company that was attempting to create a monopoly. The Minister spoke to the Journal on the matter several months ago.
Mr. Campbell, however, has consistently dismissed such concerns pointing out that competition would still remain keen in the insurance industry and that such consolidations are the way of the future.
Defending his company’s track record over the years, Mr. Campbell further pointed out that Colina stands firmly on its financial integrity and strength, an accomplishment, he claimed has been substantiated and verified by independent actuaries and confirmed again by regulators outside of The Bahamas.
“The regulatory body in Canada that has responsibility for the insurance industry in that country amongst other areas, would have already formally given their approval to Colina and Canada Life for the approval of the Bahamian branch of Canada life,” he said.
Mr. Campbell also took the opportunity to squash growing concerns that his company’s proposed acquisitions would be to the detriment of policyholders and shareholders, considering that in similar mergers in other parts of the world the actual results fell far short of projections.
The government recently warned Colina against acting as though it had already received approval for the various acquisitions.
Mr. Campbell said, “I can assure policyholders that such acquisitions – if approved – would in no way impact the premiums that they pay. Life insurance premiums are fixed by contract. Colina cannot retroactively change life insurance premiums neither can it retroactively change any of the benefits.”
Macushla N. Pinder, The Bahama Journal
