Thursday, 22 November 2018

Questions (20, 26)

Louise O'Reilly

Question:

20. Deputy Louise O'Reilly asked the Minister for Finance the steps he will take to ensure that residents affected by the liquidation of the structural warranty of an underwriter (details supplied) are not unfairly affected; and his plans to deal with this issue. [48604/18]

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Pearse Doherty

Question:

26. Deputy Pearse Doherty asked the Minister for Finance the steps he will take to ensure residents affected by the going into liquidation of an underwriter (details supplied) of their structural warranty are not unfairly affected. [48600/18]

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Written answers (Question to Finance)

I propose to take Questions Nos. 20 and 26 together.

The Central Bank of Ireland has advised me that it was notified by the Danish Financial Supervisory Authority on 7 March 2018 that it had ordered Alpha Insurance A/S to cease writing new business including renewal of existing contracts and business with immediate effect. It was further notified on 9 May 2018 that the liquidators of the insurance company Alpha Insurance A/S had filed a petition for bankruptcy.

The Central Bank has indicated that as Alpha Insurance A/S is a Danish based insurance firm, it is subject to prudential supervision by the Danish Financial Supervisory Authority, and therefore it had no role in this decision. The Central Bank has also informed me that Alpha Insurance A/S was selling non-life insurance policies, including structural warranty insurance, in Ireland through the broker network on a freedom of services basis and that it also operated in Denmark, France, Germany, Greece, Italy, Norway, the United Kingdom and Spain.

As the structural warranty insurance was initially purchased by the developer, the residents of the impacted properties may wish to get in contact with the property developer in the first instance to see if alternative cover can be arranged.

Ultimately, should there be a claim on the policy due to structural defects, the property developer should seek assistance from the Danish Insurance Guarantee Fund in the first instance. If such an application were unsuccessful, there may then be recourse to the Irish Insurance Compensation Fund to recover 65% of the cost of a claim, up to a ceiling of €825,000 per claim subject to the particular circumstances of the claim and the relevant provisions of the Insurance Acts (1964).