QIL plans to continue issuing new UK policies
Anglo and Liberty Mutual only buying Quinn's Irish operations
Published 08/06/2011 | 05:00
QUINN Insurance will continue issuing new UK policies until the end of 2012 even though the insurer's new owners are only buying its Irish operations.
The news comes six weeks after Anglo Irish Bank and US insurance giant Liberty Mutual unveiled plans to take over major parts of Quinn Insurance Limited (QIL).
Anglo and Liberty are initially taking over Quinn Insurance's Republic of Ireland book, but will have the option to buy the insurer's UK business at the end of 2012.
The Irish Independent has learned that QIL's administrators will continue writing new UK business until the end of 2012, to maintain jobs and make the business as attractive as possible for any purchase.
The UK business lost €559m in 2009, prompting QIL to withdraw from key areas including solicitors' professional indemnity insurance.
Going forward, the administrators are likely to focus their efforts on private motor insurance in Great Britain and Northern Ireland.
"They've given up huge share in the UK market because they don't want to write unprofitable business," one source said. "But keeping the UK business going for now has managed to avoid redundancies."
Hundreds of QIL staff work on the insurer's UK business and will continue to service the book until the end of 2012, working on behalf of the administrators once the sale goes through in September.
"If Liberty doesn't take the UK book then they'll have an oversized infrastructure based on today's volume of business," says one source.
"But they also believe they'll be able to grow that volume of business, so there wouldn't necessarily be job losses."
News of QIL's continued UK activity came as Finance Minister Michael Noonan yesterday defended the insurer's sale as "the best decision in the interests of the future of the company and the future of the State".
Speaking on the floor of the Dail, Mr Noonan said the deal was an "excellent" result for jobs since redundancies were confined to a small office in Manchester.
"I know it's the business plan and the intention of Liberty to grow and expand the company and increase the number of jobs," he said.
Asked why a rival proposal drawn up by the family of QIL founder Sean Quinn had not gotten more consideration, Mr Noonan said it was "on record" that the Quinn Group "was impaired for a considerable amount of time because of unwise investments in Anglo Irish Bank".
Once Ireland's richest man, Mr Quinn lost about €3bn on a disastrous bet on Anglo Irish Bank shares.