Clarity is needed immediately for the 2,000 claimants caught up in the collapse of Setanta Insurance who are still awaiting information on whether their claims amounting to €35 million will be honoured, according to Fianna Fáil Spokesperson Finance Michael McGrath.
Deputy McGrath stated: “We know from evidence given by Department of Finance and Central Bank officials to the Joint Oireachtas Finance Committee in July that about 2,000 claims with a total value of €35 million are on the books of the Setanta liquidator. These figures are expected to rise significantly as claims may not yet have been lodged for accidents that have occurred. At this point, there is no clarity as to whether or not the liquidator will be able to meet these liabilities, leaving many people completely in the dark.
“In the event that the liquidator is unable to meet the claims, the Insurance Compensation Fund (ICF) will only pay out 65% of the total claim or €825,000, whichever is the lesser, and the ICF does not apply to certain claims. This means that many Setanta policyholders and other innocent victims of accidents are facing large losses.
“I have seen a letter issued by a solicitor acting on behalf of the Setanta liquidator warning a former Setanta policyholder that he may be personally liable in the event that a third party injury claim succeeds and there is insufficient money to settle the claim. The former Setanta policyholder has been warned that a successful third party claim could result in judgment being registered against him.
“The role of the Motor Insurance Bureau of Ireland (MIBI) also needs to be clarified. The Minister for Finance initially informed the Dáil that the MIBI could accept third party claims but this has not been confirmed by the Bureau. In fact, the indications are that the Bureau is not going to accept claims from persons caught up in the Setanta collapse.
“Five months on from the appointment of a liquidator, it is not acceptable that the 75,000 Setanta customers in Ireland and others caught up in the claims process do not have answers to basic questions. In addition to outstanding claims, Setanta policyholders are out of pocket as they paid out over €10m in premiums for policies that were not honoured by the insurance company.
“The situation regarding outstanding claims, the role of the MIBI and the ICF, and whether policyholders can expect to get any of their premium payments back, need to be clarified urgently.”