Wednesday 28 September 2016

Enterprise Insurance collapse hits 14,000 Irish car premiums

Published 23/07/2016 | 02:30

Drivers affected probably have around two months of cover before their policies are cancelled. (Stock image)
Drivers affected probably have around two months of cover before their policies are cancelled. (Stock image)

Motorists have been hit by a new insurance crisis after another insurer regulated outside the country collapsed.

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Enterprise Insurance, which is regulated in Gibraltar, is being wound up.

The insurer has 14,000 ­policyholders here, selling its insurance through brokers.

Most of its Irish business was done through Wrightway Underwriting Ltd, a Wexford-based chain of insurance brokers.

Drivers affected probably have around two months of cover before their policies are cancelled.

It is not known what the cost of the collapse will be for motorists here, but it could run into millions of euro.

Read more: Motorists hit by new insurance crisis as Enterprise Insurance collapses

Malta-regulated Setanta failed in 2014, leading to a legal dispute over who should pick up the cost for the 1,700 claims that could cost €95.2m to settle.

But ultimately, the collapse of Setanta will be paid for by motorists here. There are fears the latest collapse will put new pressure on premiums.

Under EU "passporting" rules, insurers are allowed to be regulated in one country but sell insurance in another.

Under this system, when an insurer fails, the cost of paying claims sometimes falls on the country where it sold the insurance, as happened with Setanta.

Across all insurers here, premiums shot up by almost 40pc last year as the industry struggles with a number of issues.

The failure of Enterprise Insurance is likely to add to the pressure on premium rates.

The Central Bank of Ireland said it did not regulate Enterprise Ireland, but was informed by officials in Gibraltar that the firm was being wound up.

Enterprise Insurance also had operations in other European countries.

The Central Bank said: "Motor insurance policyholders in Ireland, who bought insurance through the broker network, may be affected. Any policyholder who has concerns about their policy should contact their broker in the first instance."

News of Enterprise going bust comes as new proposals made by Government officials recommend that insurance companies will have to pay more into a fund that bails out insurers that collapse.

Third-party motor claims due to the liquidation of an insurer should be met in full by the Insurance Compensation Fund (ICF), the officials recommend.

Policyholders with questions about Enterprise Insurance should contact the Gibraltar Financial Services Authority Commission on 00 350 200 40284. Or email enterprisepolicyholders@fsc.gi. Motorists affected can contact Enterprise on 00 350 200 50150.

Irish Independent

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