Dáil Éireann Debate, Thursday - 18 January 2018
55. Deputy Michael McGrath asked the Minister for Finance the last time payments were made out of the Insurance Compensation Fund for a case (details supplied); when the next payment out of the fund is expected; the amount of same; the number of claims that will be settled due to it; and if he will make a statement on the matter. [2482/18]
View answerSetanta Insurance was placed into liquidation by the Malta Financial Services Authority on 30 April 2014. As it was a Maltese incorporated company, the liquidation is being carried out under Maltese law.
The Deputy will be aware that under the Insurance Act 1964, as amended, monies may be paid out of the Insurance Compensation Fund (ICF), with the approval of the High Court, in relation to an insolvent insurer, to meet claims up to a limit of 65% or €825,000 of the claim, whichever is the lesser.
With regard to the payments in relation to Setanta Insurance, there have been two applications to the High Court for the payment of compensation from the ICF. An Order was granted in the High Court in October 2016 in respect of 249 first party claims and 1,795 windscreen claims at a cost to the ICF of €608,085.14. Subsequent to the Supreme Court judgment, an Order was granted in the High Court in July 2017 in respect of 324 claims at a cost to the ICF of €6,479,336.85. Therefore, the total amount paid out of the ICF to date in relation to Setanta Insurance is €7,087,421.99.
The liquidator for Setanta Insurance has informed me that as of 31 December 2017, there are 1,577 active claims, of these 573 claimants have been paid compensation from the ICF subject to the 65%/€825,000 limits.
Section 3B(1)(a) of the Insurance Act 1964, as inserted by Section 4 of the Insurance (Amendment) Act 2011, provides that applications to the High Court may be made by the Accountant of the Courts of Justice, where the insurer in liquidation is authorised in a Member State other than Ireland, not more than once in every 6 month period.
This provision was inserted to ensure that excessive legal and administrative costs are not imposed on the ICF and to enable claims to be made in respect of a number of policyholders at a time rather than in respect of each policyholder individually.
It should be noted that heads of the Insurance (Amendment) Bill were approved by Government in July and then sent to the Office of the Parliamentary Counsel for priority drafting and to the Joint Oireachtas Committee for pre-legislative scrutiny. This legislation based on the recommendations of the Review of the Framework for Motor Insurance Compensation in Ireland will amend the relevant Insurance Acts to, inter alia, reduce the limitation on the frequency of applications to the High Court to a 3 month interval.
No date has been fixed for the next payment from the ICF, but the Liquidator has informed me that preparatory work is underway in respect of some 275 claims to the value of c €5.8m, with a view to the Accountant to the High Court making an application before the end of March. It is important to note that only claims which have been settled can be included in applications to the High Court for payment from the ICF. The process of settling claims is still ongoing and is subject in some cases to complex negotiations between all relevant parties.
