Previous Story
Fund, govt in $500K loan settlement negotiation
|
Posted on Jan 31 2012
By Moneth Deposa
Reporter
Reporter
The NMI Retirement Fund and the Department of Finance are in a “settlement negotiation” relating to a $500,000 loan made by the central government two years ago.
Fund administrator Richard Villagomez disclosed that the amount was loaned out in 2010 to pay for the death claim benefits of employees during the period when the government was self-insured.
Villagomez said this period was when Moylan Insurance, the former life insurance carrier for the government’s Group Health Life Insurance Program, dropped coverage due to some contract dispute. He said the loan was for the death claims benefits covering three weeks prior to the hiring of the Individual Assurance Co. as the government’s new life insurance carrier.
According to Fund chair Sixto K. Igisomar, the government initially offered a repayment plan for the loan but this was rejected by the Fund because of the proposed terms and conditions. He is hopeful that negotiations will be finalized in February.
Saipan Tribune learned that the government has a little bit over one year under the original repayment term and wants to accelerate those payments in three equal lump sums to be paid to the Fund consecutively within three months. However, this option also proposes a waiver on penalties and fines.
Villagomez said the board cannot agree to the proposed waiver of penalties. Negotiations between parties, however, are ongoing, he added. He said the Fund is still collecting payments from this loan.
Early this month, the administration renewed the contract of Individual Assurance Co., the life insurance carrier for government employees, for another year or until January 2013. This renewal is a month-to-month extension that could be changed anytime during the period covered. The renewal terms did not indicate changes in the premiums or coverage of IAC.
The IAC contract expired in December. This renewal serves as the fourth extension.
