Quinn costs Irish €66m in 2013

Quinn costs Irish €66m in 2013

The so-called "Quinn levy", a 2% tax on all insurance policies introduced in Ireland at the start of 2012 to pay off the losses incurred by Quinn Insurance in the years leading up to its being placed in administration, cost policyholders €65.69m in 2013, according to numbers provided by the Irish finance minister Michael Noonan.

In 2011 the levy raised €45.56m.

Noonan said in a written reply that a further €15m had been collected this year, bringing the total collected to €126.33m.

Earlier this year counsel for the joint administrators of Quinn Insurance told the Irish High Court that Quinn Insurance was expected to leave administration, into which it was placed in April 2010, in 2016. Administrators from accountancy firm Grant Thornton have also said that no further moneys would be required this year from the fund to meet the claims of Quinn policyholders.

The Administrators have previously told the HIgh Court that the maximum sum for covering all the losses, plus administration bills, could be as high as €1.65bn. Opposition spokesman on finance Michael McGrath noted that this meant policyholders could be paying the levy for another 25 years before the debts are paid off.

Those fees include some €15m in legal fees alone up to the end of 2013, including an estimated €6.5m cost from suing Quinn Insurance Ltd's former professional advisers, PricewaterhouseCoopers (PwC). The company paid almost €4m in legal fees in 2012, and a similar amount in 2011.

McGrath said: “I am very concerned at the suggestion from Government that a further levy of 1% be introduced to deal with flooding issues. This would be on top of the 3% stamp duty we are all paying at the moment along with the 2% levy."

He claimed that the Irish insurance market was effectively dysfunctional. "This year we saw RSA in Ireland having to be bailed out by its UK parent. Up to 50,000 householders and businesses are unable to get a realistic quote for insurance against flood damage. I have repeatedly raised the need for an overhaul of the regulation of the sector with the finance minister", McGrath claimed.

Quinn Insurance's ongoing operations, excluding healthcare, were bought in October 2011 by Liberty Mutual, which contributes 25% of its profits to the State-operated Insurance Compensation Fund. Since QIL now appears to be running at a profit, that should reduce the final bill for the Irish taxpayer.

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