Liberty tells brokers to expect hikes in cover cost
Published 09/12/2012 | 05:00
Quinn Insurance's new owner has warned that it will no longer insure workers in hazardous trades such as demolition.
LIBERTY, the American insurance giant which has taken over the insurance business formerly owned by Sean Quinn, has written to its brokers warning them it will have to jack up its prices in the future.
Liberty Insurance has told brokers it requires a "significant price correction" in its commercial insurance business, particularly in property and liability cover. The American company said the type of insurance being sold when the business was run by the Quinn family is now "widely accepted to be challenged with a high proportion of clients in hazardous trades".
Liberty said much of its legacy commercial book was "seriously underpriced and forecast to be losing money into the future if left unattended. This situation is definitely unsustainable."
The insurance group said it planned to introduce a new range of minimum premiums before it was prepared to take on certain risks. This included a minimum premium of €1,000 per commercial policy which would rise to €5,000 for risks in high-hazard trades.
Liberty also circulated to brokers a list of 36 different categories of occupations it was no longer prepared to insure, including abattoir workers, car dismantlers, demolition contractors, nightclubs and fishermen working on trawlers.
Quinn Insurance was previously prepared to insure these categories. However, Liberty said it was not prepared to cover them any more because of their "poor claims records", among other reasons.
"We appreciate it will not be easy for every broker/client to accept these decisions," Liberty told brokers, "but as a business owner yourself we trust you will understand logically why action must be taken."
In mid-November, Liberty said it planned to cut one in five jobs in Cavan, Dublin and Enniskillen as part of what it called its return to "sustainable profitability". In total, 285 people out of 1,450 staff are being let go between now and March 2013.
The Quinn family has claimed that the job losses are a "terrible indictment" of how the company is now being run.
This is rejected by Liberty which has described the redundancies as unfortunately necessary in order to secure the business.
Sunday Indo Business