Dáil Éireann Debate, Wednesday - 9 July 2014
77. Deputy Éamon Ó Cuív asked the Minister for Finance the arrangements in place to ensure that insurance claims for personal and property losses against Setanta Insurance, which is in liquidation, are paid in full; and if he will make a statement on the matter. [30342/14]
View answerSetanta is a Maltese incorporated company which was both authorised and prudentially supervised by the Malta Financial Services Authority (MFSA). The Central Bank is in contact with the MFSA in relation to Setanta Insurance Company Limited, the impact on policyholders and the provision for relevant and appropriate information. The current legal and regulatory framework for the provision of insurance in the EEA, and the supervision of that activity, is prescribed by European Union Law in the Life and Non-Life Insurance Directives. The provision of insurance throughout the EEA on a freedom of services basis and a freedom of establishment basis (i.e. a branch) within this framework is predicated upon the absence of internal market frontiers and the mutual recognition of the authorisation of insurance undertakings by Member States.
With regard to the position of Setanta policyholders, my officials have been in discussions with the Central Bank, with the Setanta Liquidator, the Accountant of the High Court and with the insurance industry representative bodies. We are endeavouring to obtain legal certainty on a number of matters relating to unearned premiums and policyholders' claims for compensation and this will be made publicly available in due course. When clarification has been received from the liquidator in the first instance, I will consider what steps, if any, will be appropriate. At this time, I propose to set out the position as it currently stands.
Setanta was formally placed into liquidation by the MFSA on the 30 April 2014 and a liquidator was appointed. Officials from my Department together with officials from the Central Bank met with the Liquidator and his representatives in Ireland on 7 May 2014 and both my Department and the Central Bank are in ongoing contact with him regarding the position of Setanta policyholders. All Setanta policies have now been cancelled by the liquidator in line with the terms of the policies. With regard to Setanta premiums and claims, the position on each policy is for the liquidator to decide in due course. My officials and the Central Bank will remain in close contact with the Liquidator and I have asked that public statements are provided to clarify matters for policyholders and claimants.
The Motor Insurance Bureau of Ireland (MIBI) is a non-profit-making organisation registered in Ireland. All insurance companies underwriting motor insurance in this county must, by law, be members of MIBI and contribute to the funding of claims in proportion to their market share. The principal role of MIBI is to compensate innocent victims of accidents caused by uninsured and unidentified vehicles. This is regulated under the terms of an Agreement between the MIBI and the Minister for Transport, Tourism and Sport. MIBI is in the process of obtaining legal certainty on its role in relation to Setanta policyholders. If, for legal reasons, MIBI is not in a position to accept a claim, third party claims will be eligible to proceed for consideration by the High Court for compensation from the Insurance Compensation Fund (ICF).
The legislation dealing with the ICF provides that claims by bodies corporate or unincoorporated bodies are not covered by the Fund except where there is a liability to or by an individual. Furthermore, all ICF payments are subject to the limit of 65% of the amount due or €825,000, whichever is the lesser. Refund of premiums is not allowable from the ICF.
