Irish policyholders to escape paying for Qudos collapse
MOTOR policyholders here are set to escape having to meet the cost of claims from the collapse of Danish insurer Qudos.
This is because the insurance company has gone bankrupt in Denmark, meaning the bill for outstanding claims will have to be picked up by the Danish authorities.
There are over 1,500 claims in the system.
A change in the law in Denmark last May could have meant the Danish scheme would not have been liable to meet Irish claim if Qudos was declared bankrupt after January 1 next.
Qudos was authorised and regulated in Denmark, but was able to trade here under European Union freedom of services rules, selling through Wexford-based agent Patrona. It had 50,000 customers here.
The Insurance Compensation Fund in this country would have been forced to pay the outstanding claims of the policyholders here if Qudos was declared bankrupt from the start of January.
The Irish fund is already being used to fund claims related to the multi-billion euro black hole in Quinn Insurance and claims related to Setanta Insurance.
And there are already fears the bankruptcy of another Danish insurer that did business here, Alpha, may see the compensation fund called on to pay any claims related to that firm.
The Danish Financial Supervisory Authority said in a statement: “The Danish insurance company Qudos Insurance A/S has been declared bankrupt.”
It said policies would be cancelled three months after the declaration of the bankruptcy.
“The Danish Guarantee Fund for non-life insurance undertakings will cover some claims incurred four weeks after the liquidator has notified the policyholders of the bankruptcy.”
Fianna Fáil finance spokesman Michael McGrath said it was now essential that the claims are paid quickly, unlike the situation with Setanta Insurance.
Those drivers with Setanta-related claims had to wait years for pay-outs after a wrangle here about which fund was liable for the costs.