Michael McGrath (Cork South Central, Fianna Fail)
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14. To ask the Minister for Finance the action he will take to ensure persons with third party claims against Setanta Insurance are not left facing significant shortfalls in compensation particularly in the case of persons who suffered catastrophic injuries; and if he will make a statement on the matter. [41752/14]

Michael Noonan (Limerick City, Fine Gael)
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At the outset I would like to say that I am aware of the difficulties that the liquidation of Setanta Insurance Company Limited has caused for Setanta policyholders and those claiming compensation under Setanta insurance policies.   

You will appreciate that a liquidation of an insurance company is a legally complex and time consuming process.  The Setanta Liquidator is currently examining a range of factors in order to estimate the cost of claims and the extent to which claims can be met in the Setanta liquidation.   

The Liquidator has advised that settlements can only be paid out after all of the company's liabilities are quantified, including claims.

The Insurance Compensation Fund (ICF) provides for payments to meet the liabilities of insolvent insurers in certain cases where it is unlikely that claims can be met otherwise than from the ICF.  Under the Insurance Act 1964 claims by bodies' corporate or unincorporated bodies are not covered by the ICF, except where there is a liability to or by an individual.  In addition, all ICF payments are subject to a limit of 65% of the amount due or €825,000, whichever is the lesser.  Management and administration of the ICF is under the control of the President of the High Court acting through the Office of the Accountant of the Courts of Justice. 

I am pleased to say that I have been informed that having sought legal advice on the operation of the legalisation, the Accountant is now satisfied that it is appropriate to make applications to the ICF for compensation prior to the completion of the liquidation of Setanta. 

Every effort is being made to ensure that claims can be dealt with as expeditiously as possible. The Accountant of the Courts of Justice is in ongoing discussions with both the Setanta Liquidator and his legal advisors to put in place appropriate mechanisms to commence making applications to the High Court in accordance with the Insurance Act 1964. In tandem with this he is also working to acquire the necessary skilled resources to enable applications to the ICF to be processed effectively and efficiently. Due to the unprecedented nature and scale of the Setanta insolvency the Accountant is not yet in a position to provide a timetable for applications to be made to the Fund, but it is hoped that applications by the Accountant to the High Court can begin sooner rather than later. 

Current estimates indicate that the shortfall for most Setanta claimants will be relatively small once they have received the 65% compensation available from the ICF as well as their distribution from the Liquidation. I understand that there is the very small number of large claims where the maximum ICF payment of €825,000 will apply. However it is important to note that this estimate is based on an evaluation of claims reserves by the Liquidator. Actual claims experience may decrease the amount available for distribution by the Liquidator.

I appreciate that the current uncertainty regarding the timing of compensation payments is causing difficulty for the former customers of Setanta Insurance and I have asked that information on ICF procedures is made available publicly as soon as possible. The Accountant of the Courts of Justice can only deal with claims which are submitted by the Liquidator, so the advice to all claimants continues to be that they should contact the Liquidator of Setanta.