Dear Claudienne

On October 1, 2016 I was travelling on the Top Hill main road in Junction St Elizabeth when an Isuzu truck skidded across the road and hit the side rear of my pickup.

The owner of the truck accepted responsibility to fix my pickup and referred me to his Insurance company, Insurance Company of the West Indies (ICWI).

I also reported the accident to my insurance company, Jamaica National General Insurance (JNGI), which instructed me to do an accident report and attach the estimate of the damage.

I asked Toyota Jamaica, the company from whom I had bought the pickup a little over a year before the accident, to prepare the estimate.

When Toyota Jamaica gave me the estimate I sent it to JNGI and they in turn sent it to ICWI.

My insurance company then informed me that ICWI had agreed to fix my pickup. Six months later JNGI called and told me to come and collect the cheque to offset the repairs to my pickup. When I went to collect the cheque to do the repairs, the JNGI representative informed me that I would have to pay GCT on the Toyota Jamaica charges for the repairs to the pickup.

He said that I would be reimbursed the money I paid for GCT.

I paid Toyota Jamaica the GCT charges on the bill and took the invoice to JNGI, with the expectation that I would be refunded the GCT charges. However, two weeks later I was informed that ICWI had refused to reimburse the GCT I had paid, on the grounds that JNGI had not discussed the payment with them.

I was not aware that the vehicle could be repaired without GCT charges, or are the insurance companies just trying to frustrate me, a small man?

I sent a written complaint to the Financial Services Commission, the Government agency that oversees these bodies, over a year ago now but the matter is still not settled.

I have seen where you have helped many people so I would appreciate any assistance you can afford me to get an early resolution to this problem.

I also have e-mails of discussions between JNGI and FSC on this matter that I can send you.

EB

Dear EB

Tell Claudienne has been in communication with ICWI and JNGI about your GCT refund.

In reply to an e-mail from Tell Claudienne the claims manager at ICWI stated the following:

“It is customary for ICWI to reimburse GCT once same is incurred. In EB’s case, no proof of GCT was submitted. When we settled his claim in February 2017, we paid based on the claim documents presented to us by his insurer. We were only notified in June 2017 that EB was requesting a subsequent payment of GCT, as per final bill dated May 2017.

Please bear in mind that by signing and returning a full and final release in February 2017, EB accepted an offer of settlement and no further claim would be expected on this said accident.”

Tell Claudienne then responded to the ICWI claims manager’s e-mail as follows:

“Good afternoon and thanks for your e-mail. However your e-mail does not mention our telephone conversation on Monday, July 16, 2018 when you promised to waive the full and final release and refund EB’s GCT payment.

Please clarify re the undertaking you gave to refund EB the GCT.”

On July 18, 2018 the ICWI claims manager replied to Tell Claudienne and stated:

“As indicated, we will pay EB the GCT though there is no legal basis to make this subsequent payment.”

Tell Claudienne also received an e-mail response to your complaint from JNGI.

JNGI stated:

“Thank you for bringing to our attention the complaint made by our insured EB. The complaint centres around his inability to recover from ICWI, GCT expenses he incurred in repairing his motor vehicle following an accident with an ICWI insured.

By way of background, EB met in an accident on October 1, 2016. The third party to the accident was insured with ICWI. As the third party was at fault and the amount of the loss fell below EB’s policy excess, the loss was fully recoverable from ICWI. On January 16, 2017, the claim details to include the estimate of repairs from Toyota Jamaica (which included GCT estimate) and our demand letter were submitted to ICWI and on February 10, 2017 ICWI sent its release-which was executed by EB and returned to ICWI on February 22, 2017. On March 23, 2017 a settlement cheque was received from ICWI. The cheque did not include the GCT charges. EB subsequently repaired his vehicle with Toyota Jamaica and the final repair bill showing GCT charges incurred was submitted to us in August 2017. As is customary, we submitted same to ICWI for purpose of recovery of EB’s GCT expense. We were, however, unsuccessful in obtaining recovery on EB’s behalf.

JNGI’s practice in these matters is based on an industry agreement following clarification from the Tax Administration Directorate (attached) on how these matters are to be treated. GCT is a reimbursable expense which is to be paid to a claimant once proof is submitted that the GCT indeed incurred. The effect of this is that when a claimant submits an estimate of repairs which includes GCT charges, the insurer, having accepted liability for the loss, will, where cash is being paid in lieu of repairs, make a settlement offer to exclude GCT charges. The insured will then effect the repairs and pay any applicable GCT charges, then submit the final bill to the insurer for reimbursement of the GCT expense. This approach is generally consistent throughout the industry.”

JNGI also sent Tell Claudienne the following letter, dated March 3, 2011, from the Director General’s Executive Office of the Tax Administration Directorate, Ministry of Finance and the Public Service-sent to the executive director, Insurance Association of Jamaica

Re: Payment of GCT on the Reimbursement of insurance claim

“Reference is made to your e-mail dated February 28, 2011, where you enquired about the payment of General Consumption Tax (GCT) to a claimant in a cash settlement of a motor claim, where the client has tendered no invoice to substantiate the reimbursement of GCT.

The policy of Tax Administration is that where a settlement is reached with a client, the only basis on which the general insurance company can reimburse a client for the GCT portion of any claim is where an actual invoice is presented to the insurance company evidencing GCT paid to a legitimate, registered taxpayer.

Pursuant to Regulation 8 of the GCT Act, a tax invoice must contain the following information at a minimum: The name, address and registration number of the registered taxpayer issuing the tax invoice; the serialised number of the tax invoice; the date on which the taxable supply is made; the quantity and description of the taxable supply; the total amount of the consideration for the taxable supply; the rate of tax and the amount of tax payable, and the total amount of the consideration and the tax applicable to the taxable supply.”

Since Tell Claudienne contacted ICWI and JNGI, the insurance companies have discussed your claim for GCT reimbursement. On Wednesday, July 25 the column was told that to facilitate the immediate payment of the GCT to you, the insurance companies have agreed that JNGI will send your GCT cheque to their Mandeville office and that ICWI will reimburse JNGI.

We note that you were contacted by JNGI on Wednesday July 25 and told to pick up the cheque at their Mandeville office.

We wish you all the best.

Have a problem with a store, utility, a company? Telephone 936-9436 or write to: Tell Claudienne c/o Sunday Finance, Jamaica Observer,40-421/2 Beechwood Avenue, Kingston 5; or e-mail: edwardsc@jamaicaobserver.com. Please include a contact phone number.