Watchdog learns findings of Quinn Insurance investigation
THE Financial Regulator, Matthew Elderfield, has been given the findings of the joint administrators' investigation into alleged breaches of insurance regulations by Quinn Insurance, the High Court heard yesterday.
Administrators Michael McAteer and Paul McCann yesterday presented their fourth report to the president of the High Court, Mr Justice Nicholas Kearns, since the regulator put the insurer into administration in March.
Yesterday, Bernard Dunleavy, for the administrators, said his clients were happy with the way that the administration process was progressing.
The court heard said the administrators had been keeping a tight eye on the company's solvency ratios, and that Quinn would not have to avail of the Insurance Compensation Fund, which was set up by the Government to protect all policyholders in the event that an insurer could not meet its liabilities.
The process to sell the insurance group had now entered its second stage, in which Quinn's non-executive directors were to be replaced with independent directors, the court heard.
The administrators, in their report to the court -- elements of which were confidential for commercial reasons -- said more than 800 redundancies required from the workforce in 2010 would be achieved through voluntary redundancies and natural wastage.
The merchant bankers hired to help sell the group, Macquarie Capital Europe, had originally identified 90 prospective buyers for Quinn, counsel said.
That number was reduced to 11 before the commencement earlier this month of the second phase of negotiations, he said.
For commercial reasons the number of parties involved in the second phase was not being disclosed publicly, counsel said.
Among the confidential elements was a section of the report dealing with the solvency of the insurer, the number of prospective buyers involved in the second stage of the process to sell the insurer and when the process would be complete, Mr Dunleavy said.
Counsel said that overall business in Ireland had improved and that Quinn's UK motor insurance business had also been going well. While the regulator had stopped Quinn from underwriting commercial insurance in the UK, he had allowed it to continue to provide insurance to one single large unnamed client.
Counsel added that the administrators were able to successfully redeploy 46 employees who were involved in the commercial insurance business in the UK.
Mr Justice Kearns, expressing concern over fees, said these matters had been cited in other commercial hearings.
The administrators previously secured approval of the costs of some €565,000 for their work between March 30 and April 30, 2010, and liberty to invoice the company monthly up to the end of July for fees for sums not exceeding €1.8m.
The court also permitted them to pay their solicitors, McCann Fitzgerald, some €120,000 for work between March 30 and April 30 and for legal costs incurred since then.