Dáil Éireann Debate, Thursday - 25 January 2018
70. Deputy Pearse Doherty asked the Minister for Finance when the remaining claimants in relation to a company (details supplied) will be compensated; the way in which the State is protecting customers of the company from personal liability; and if he will make a statement on the matter. [3747/18]
Amharc ar fhreagraSetanta 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.
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.
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.
In relation to the issue of policyholder liability, I am advised that there are still ongoing disputes around liability between policyholders and third party claimants, and in some instances, there may be more than one claim against a single policyholder. As this is a matter for third party claimants to make a decision on, the Government has no direct role in this process.
The policyholder liability issue is directly related to the shortfall anticipated by claimants. In relation to any Government intervention to fully compensate third party claimants over and above the 65% limit, and then “step into the shoes” of these claimants to recover directly any balance due from the Setanta liquidation, there is a legal concern that this could result in the Government having a lower status in the creditor hierarchy, and thus significantly reduce the amount it could recoup from the liquidator.
In this respect, my Department sought and received advice from a Maltese law firm on this matter. This advice has been reviewed by the Office of the Attorney General. In addition, my Department has recently met with the Liquidator to receive an update on the status of the liquidation process as well as the issues he is encountering in settling claims. Based on this up to date information and the legal advice, the various courses of action open to the Government in relation to this issue are actively being considered.
