Tom Hayes
Question:124 Mr. T. Hayes asked the Tánaiste and Minister for Enterprise, Trade and Employment her plans to take action regarding the adverse consequences of the collapse of a company (details supplied). [28626/01]
Written Answers. - Insurance Industry.
Independent Insurance Company Limited, IICL, was a UK authorised insurer. Accordingly, responsibility for ensuring that IICL could meet claims from its policyholders lay with the UK authorities, which were responsible for the financial supervision of the company.
The current position is that the company is in liquidation and the liquidation process will be dealt with under UK law. The company is also under investigation by the serious fraud office in the UK. The UK does not operate a "no failures" policy in relation to financial institutions. It has, however, a safety net in the form of the policyholders protection fund to compensate policyholders of failed insurance undertakings who meet certain criteria. The UK authorities have indicated that Irish private policyholders are likely to qualify for protection – of 90% – under the UK Policyholder Protection Act. While the UK authorities have undertaken to examine the application of the existing law governing the UK policyholders protection fund to Irish policyholders, it seems unlikely that corporate policyholders will qualify for protection.
This issue has been raised at EU level by Ireland, with proposals that the cross-border consequences of insurance failures should be regulated. While this will not alleviate the problems arising, in the Independent case, it will address similar problems arising in the future. I fully appreciate the difficulties being faced by some policyholders here, and am very concerned that any company would face closure, because of the failure of Independent Insurance Company. However, it would not be acceptable to burden taxpayers with the inevitable cost that would be involved in meeting insurance claims resulting from the failure of this UK company.
Question No. 125 answered with Question No. 111.