The Danish Financial Supervisory Authority, or Finanstilsynet, advised subscribers of compulsory insurance policies issued by Alpha Insurance A/S to take out new policies with other insurers as soon as possible because the Danish insurer has gone bankrupt.
The regulator advised other policyholders to report their claims to the Danish Guarantee Fund for nonlife insurance, subject to coverage by the fund, as well as to Alpha Insurance, before Nov. 8. The guarantee fund will cover claims due prior to the bankruptcy. Also covered are claims incurred up to four weeks after the curator informed policyholders about the bankruptcy, the regulator said.
The Central Bank of Ireland also asked Alpha Insurance policyholders to contact their brokers to immediately arrange alternative insurance coverage, while the U.K. Financial Services Compensation Scheme said the insurer had defaulted under Policyholder Protection Rules. It is working with Danish parties on how compensation claims will be handled, the scheme said.
The bankruptcy has affected up to 700 London taxi drivers and 10,000 minicab drivers, BBC reported, citing the Licensed Taxi Drivers Association. Alpha was the insurer behind the Cover My Cab and Protector brands.
The company was placed into solvent liquidation and ordered to stop writing new policies in March. A general assembly decision to put the company into solvent liquidation was a consequence of New Zealand-based CBL Insurance Ltd., being placed into interim liquidation, which was in turn a result of reserving issues in its French construction insurance business.
Administrators in New Zealand recommended May 11 that CBL Insurance parent CBL Corp. Ltd.be liquidated.
In addition to the U.K., Denmark and Ireland, Alpha also operated in France, Germany, Greece, Italy, Norway and Spain, the Irish central bank said.