Danes to pick up tab as Qudos goes bust
Insurer leaves 1,400 Irish claims, estimated to run tens of millions of euro Irish Insurance Compensation Fund escapes liability by three weeks
Copenhagen insurer Qudos Insurance has filed for bankruptcy, meaning Danish authorities will pick up the tab for 1,400 Irish claims, estimated to run into tens of millions of euro. Qudos, which sold insurance in the Republic through local agent Patrona, went into solvent liquidation in Denmark late last month and said on December 4th that it was no longer paying insurance claims.
The company had about 50,000 Irish customers at the time, mainly covering commercial and motor policies, though it is understood that most of these have now been transferred to other providers.
Not be liable
Last week, the Minister for Finance Paschal Donohoe said his department had been advised by Denmark’s finance ministry that if Qudos was placed into bankruptcy after January 1st, 2019, the Danish Insurance Guarantee Scheme would not be liable to meet claims.
This would have meant that the Irish Insurance Compensation Fund (ICF) would be liable. However, Qudos’s filing for bankruptcy yesterday in Copenhagen will result in the Danish fund taking responsibility for claims, including those from Irish customers of the failed company. Qudos began writing Irish business in 2013.
Insurance Ireland, the industry representative body, welcomed the development.
“Thankfully, the cost of these claims will now be covered by the Danish guarantee fund.
The priority now is ensuring that Irish policyholders with outstanding claims are given clarity on how and when their claims will be settled by the Danish Guarantee Fund,” a spokesman for the organisation said.
The Danish Financial Supervisory Authority (DFSA) said the country’s compensation fund covers claims incurred before the date of the bankruptcy and up to four weeks after that the date.
“If a policyholder has a claim that is covered by the guarantee fund, the claim must be reported as soon as possible and no later than 20 June 2019,” the authority said, adding that claims reported to Qudos up until now are regarded as reported to the guarantee fund, and that it has opened a hotline for any inquiries.
The Central Bank said that it is “strongly recommending that the small number of remaining Irish policyholders arrange alternative cover with immediate effect”.
It added that it is working with the DFSA to ensure that all Irish policyholders are identified and communicated with directly.