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Insurance Industry Issues

Dáil Éireann Debate, Thursday - 15 November 2012

Thursday, 15 November 2012

Questions (26)

Barry Cowen

Question:

26. Deputy Barry Cowen asked the Minister for Finance when he expects a definitive update to be available on the cost of the collapse of Quinn Insurance; and if he will make a statement on the matter. [50489/12]

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Written answers

At the outset the Deputy should note that the nature of insurance is such that it is not possible to provide a definitive update on the cost of the collapse of Quinn Insurance until the bulk of the claims have been paid, which is unlikely to be for several more years yet. However the Joint Administrators when presenting their 10th report to the High Court in July 2012 indicated that the potential call on the ICF could be up to €1.65bn. The Joint Administrators pointed out in their report that the projected call on the ICF now includes accounting adjustments and considerable contingencies which it is hoped will not be called upon. They indicated that if they were to remove most of the accounting adjustments and use a “best estimate ” calculation, then the call on the fund is likely to be in the range of €1.1bn to €1.3bn rather than the €1.65bn for which they have provided.

I have been advised that the Joint Administrators have undertaken a number of actions in relation to claims settlement which can reduce the ultimate claims cost. These include as part of a new enhanced governance structure the establishment of a Claims Advisory Committee (CAC) to guide and advise them and QIL management on future claims strategy and policy.

Furthermore, to protect the Exchequer interests I have ensured that the State Claims Agency is more involved in the administration process, particularly in the claims management area, which is critical to keeping the call on the ICF down to its lowest level possible. In this respect it should be noted that, at my request, Mr Ciaran Breen, Director of the State Claims Agency has been appointed as Chair of the Claims Advisory Committee.

My Department proposes to continue to work with the Joint Administrators and to use the services of the State Claims Agency to monitor progress with a view to ensuring, in as much as it can that the most cost effective outcome to this process is achieved.

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