The Bentley Friendly Society, set up in October of 2012 to provide property, home, automobile and motorcycle insurance, has been told the Transport Control Department (TCD) will no longer accept their certificate of motor insurance documents “with immediate effect”.

Bentley, which has seven trustees and 45 members, was in news at the end of March when the Bermuda Monetary Authority (BMA) said insurance policies of all kinds issued by the friendly society were not regulated by it. A press release at the time said: “The BMA has become aware of property, home, automobile and motorcycle insurance policies being sold by a friendly society in Bermuda to persons who are, or become members of the society.”

It continued: “The Authority wishes to advise that the offer of such policies by an entity, which is registered under the Friendly Societies Act of 1868, is not regulated by the Authority. Accordingly, it does not have to comply with solvency or liquidity requirements that apply to domestic insurers under the Insurance Act.”

Bentley objected to the BMA’s statements, and trustee Kevin Bean-Walls said at the time: “We request that the BMA be required to withdraw their disparaging press release and apologise for attempting to discredit our organisation ... We believe the attack by the BMA undermines all mutual organisations — not just ours.”

Instead, Government authorities turned the spotlight on vehicle licensing and a Transport Control Department advisory to Bentley Mutual Insurance Company policy holders was released yesterday, which stated: “The Director of the Transport Control Department (TCD) on April 4 advised holders of insurance coverage through Bentley Mutual Insurance Company that they are not insured under the Motor Car Insurance (Third Party Risks) Act 1943.

It stated that Bentley “does not have the authority to insure the risk of loss to third parties, and therefore this notice is being issued to holders of the Certificates from Bentley”.

This warning was issued: “Such individuals with a Bentley Mutual Insurance Company certificate who are operating a motor car or livery cycle should immediately consider that they are uninsured. This means that if they are found to be responsible for any damage or injury to other users of Bermuda’s roads, they may have inadequate insurance coverage to make good a claim against them. They should not operate their vehicle until they have adequate insurance.

“Individuals who have been issued a certificate of Motor Insurance by Bentley Mutual Insurance Company should immediately contact one of Bermuda’s insurers with authority to insure third party risks and procure a policy.”

The BMA would not comment on the development, saying: “Please note that we have nothing further to add to the position already stated in our news release dated Thursday, 20th March 2014.”

Earlier this week Mr Bean-Walls received a letter from TCD director Jasmin Smith, which reads: “ ... on the instruction of the Attorney-General’s Chambers, the Transport Control Department is no longer able to accept Certificate of Motor Insurance documents issued by Bentley Mutual Insurance Company, with immediate effect.”

Bentley trustee Mr Bean-Walls responded: “Please note that motor insurance policies are standard. The policy issued by Bentley Friendly Society is identical to policies issued by (for example) Colonial. Our policy holders/members have been authorised by the Bermuda Government under the Friendly Society Act 1868 to retain their own risk of loss. The risk of loss extends to third party claims.

“The gist of the Motor Car Insurance (Third Party Risks) Act 1943 is that operators of motor vehicles have proof of insurance in the event of an accident. Our policyholders/members have that proof.”

Mr Bean-Walls said that the Transport Control Department has been issuing licence documents to Bentley members since November 2013.

He said Bentley is aware they are unregulated by the BMA. “We know that,” he said. “We are exempt from the Insurance Act 1978 as per section 57. We retain our own risk, we do not sell insurance.”

He went on to defended Bentley’s financial arrangements. “The premium received by Bentley is consistent with the premium charged by other insurers in order to ensure that we have the financial resources to meet our claims. We estimate our claims and reserves accordingly.”

He said Bentley makes adjustments if claims are more or less than their estimates, and explained: “The Friendly Society Act 1868 was intended to assist organisations in creating their own capital. Insurance is an ideal way for these organisations to create capital as it is a legislated/required expense of all users of motor vehicles.”

The Bentley trustee called the friendly society “a small organisation of approximately 50 contracts” and asked: “Why is the government expending so much effort to stop us?

“If there is an issue with our policies, explain it to us and allow us to rectify it. Why is it necessary to refuse to serve our policyholders?”

“We are asking the Bermudian public to support us. And we are asking for the government to stop this attack.”