Setanta 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 refund of premiums for commercial and personal insurance policies is not covered by the ICF. However, a portion of any such refund due, may be met from the proceeds of the distribution of Setanta's assets on completion of the liquidation process.
The Deputy will also be aware of my decision in principle that the State will ensure that Setanta third party claimants are compensated in full, which was announced on 30 January. The Department of Finance is now working through the detailed arrangements to implement this decision, which is likely to require legislative change. In this regard, the next step is to give consideration as to whether there is any state aid or other legal issue associated with the proposed approach. The Department is currently working with the Attorney General’s Office on this issue and once the position is clarified I can give an indication of the likely timeline for payment, including the payment of the additional 35% to those who have settled their claims and have already received compensation of 65% of their claim subject to the limit outlined above.
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 limit.
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. These payments will be paid subject to the 65%/€825,000 limit.
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. It is hoped that by the State taking steps to ensure that third party claimants are compensated in full, this will encourage the settlement of all outstanding claims as quickly as possible.