The Financial Regulator steps in to assist Quinn Direct
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The Financial Regulator steps in to assist Quinn Direct
A High Court ruling yesterday appointed two joint provisional administrators to Quinn Insurance Limited after an application by the Financial Regulator. The appointment of these administrators has been met with some anger and refusal from members of senior management of the Quinn Group.
The areas of the Quinn Group that are affected are as follows:
Ø Home Insurance
Ø Health Insurance
Ø Motor Insurance
Ø Public Liability Insurance
The Financial Regulator has stated that Quinn Insurance policy holders can continue to renew policies, carry out new business and make claims in the normal procedures. The Financial Regulator has also stated that such an appointment was made in the best interests of the customer.
It has been discovered that subsidiaries of Quinn Insurance Limited had made guarantees in relation to the groups assets which reduced the amount of cover for policyholders liabilities was told that its assets were reduced by € 448 million, The court heard that Quinn had gone from having assets-over-liabilities of some € 200 million to an excess of liabilities of more than € 200 million. As a direct result this has unearthed some serious solvency issues for the company. The guarantees that were given were described as “a matter of the gravest concern”.
The regulator felt that the manner in which the business of the insurer is being and has been conducted has failed to make adequate provisions for its debts.
The administrators have an on site presence in the company offices. Even though the administration process can be a long drawn our process, there are three scenarios that which are available:
Ø The company could come out of administration as a profitable, independent concern and continue to trade as it has done in the past.
Ø It could come out of administration and be sold to a rival operator who would assume any of its losses.
Ø It could remain in administration ahead of a long wind up.
It shall be interesting to see what lies ahead for Ireland second biggest insurer after such revelations.
John McCarrick
John McCarrick and Associates
11 Dunville Avenue, Rathmines
Dublin 6,Ireland
Telephone:01 4960102
Fax: 01 4973717
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