Affirma Insurance has told TTG there is “not a problem” with agents’ claims despite difficulties at its underwriter CBL Corp, an insurer and reinsurer of financial risk.
Auckland-based CBL’s chief operating officer has left the company and shares trading on stock markets in New Zealand and Australia were suspended earlier this month. CBL warned it would be in the red for 2017 by around £44 million and said it had sought £52 million in reserve strengthening, but it has cash balances of around £263 million.
Ireland’s Central Bank has also ordered Dublin-based CBL Insurance Europe to stop writing new business, forcing Ryanair to seek a new provider for the insolvency component of its travel insurance. However, CBL said there were “no issues” with its long-term security.
Lawrence Assock, Affirma’s head of commercial partnership and underwriter, said CBL had confirmed it was currently signing off claimants’ payments resulting from Monarch’s failure and they are in the process of being paid: “There is not a problem with our insurer, every single client is happy about this. Anybody that had a failure policy that covered the failure and has submitted claims will get them settled,” he told TTG.
CBL’s problems related to an investment in a French subsidiary that did not affect its UK operations.
Assock said the final Monarch bill would be less than the claims, due to “virtual” credit cards being liable in the first instance. “Companies are covered by the cards’ terms and conditions in the same way that consumers are under the Consumer Credit Act,” he said.
Assock added that the matter was complicated by claims made prior to December 14, 2016, when all Monarch flights were covered by the Atol system due to the CAA insisting on an additional level of protection.
An Abta spokesperson said there did not appear to be an issue. “Members are getting claims paid,” they said.
