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Danish insurer Alpha placed into liquidation, ceases underwriting

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Danish insurer Alpha placed into liquidation, ceases underwriting

The Danish Financial Supervisory Authority ordered local insurer Alpha Insurance A/S to cease all underwriting, including renewals of existing contracts and business, effective immediately, as the company's general assembly placed it into solvent liquidation.

The Danish insurer said the decision was a direct consequence of New Zealand-based CBL Insurance Ltd., one of its significant reinsurers, being placed into interim liquidation, thus potentially being at risk of not meeting its obligations towards Alpha Insurance. The Danish regulator said Alpha Insurance no longer complies with the minimum capital requirement, which could have negative implications for its policyholders.

The Danish FSA said at February-end that it was conducting an inspection of Alpha Insurance and ordered the firm to reduce the value of its receivables by 35.6 million Danish kroner, so that they reflect the ability of counterparties to meet their obligations toward the company. It said it expected this to cause Alpha Insurance's eligible own funds to be insufficient to meet the solvency capital requirement.

Alpha Insurance, which operates in the U.K. on a freedom of service basis, said it expects to honor all present and future obligations, while also confirming it continues to operate and all policies in force will be served as per usual.

As of March 6, US$1 was equivalent to 6.00 Danish kroner.