Public Statement - Boston Life and Annuity Company Limited (13 July 2007)

Summary

This is a public statement issued by the BVI Financial Services Commission under Section 37A(4) of the Financial Services Commission Act, 2001, concerning Boston Life and Annuity Company Limited, a company licensed to carry on general and long term insurance business from within the British Virgin Islands. It discloses the background to an ongoing Commission investigation and a directive issued against the company.

• Background: Since April 2006 the Commission investigated complaints that Boston Life improperly terminated insurance policies to avoid refunding unused premiums to policyholders.
• Investigative steps: The Commission issued document production notices in June 2006 under Section 32 of the FSC Act, retained Kroll Inc. as forensic accountants in July 2006, and appointed Kroll as an examiner under Section 36(1)(a) of the FSC Act in January 2007.
• Directive issued: On 13 July 2007 the Commission issued a directive to Boston Life under Section 40(1)(a)(ii) of the FSC Act requiring it to cease and desist forthwith from entering into any new insurance business contracts.

The cease and desist directive applies for 90 days from the date of the directive or until further notice from the Commission, and the investigation into Boston Life was ongoing at the time of publication.

Key obligations

• Boston Life and Annuity Company Limited must cease and desist forthwith from entering into any new contracts for insurance business for 90 days from 13 July 2007 or until further notice by the Commission.

Applies to

insurance companies, insurance licensees

Deadlines

• 90 days from 13 July 2007, or until further notice: Period during which Boston Life must not enter into any new insurance business contracts, per the Commission's directive under Section 40(1)(a)(ii) of the FSC Act.