CBL Insurance Europe DAC has announced today that they have immediately ceased writing all new contracts of insurance and will not be renewing any existing contracts of insurance.
CBL Insurance Europe DAC, one of the participating insurers in the solicitors’ professional indemnity insurance market in this jurisdiction for 2017/2018, has announced today that they have immediately ceased writing all new contracts of insurance and will not be renewing any existing contracts of insurance, as directed by the Central Bank of Ireland as part of their supervisory engagement process pursuant to Section 45 of the Central Bank (Supervision and Enforcement) Act 2013.
CBL Insurance Europe DAC continues to operate and existing policies continue to remain in force.
The parent company of CBL Insurance Europe DAC, which is based in New Zealand, has had its shares suspended by New Zealand and Australian regulators, and its financial strength rating downgraded by A.M. Best from A- to B++, due to concerns about the company’s reserves in France.
CBL Insurance Europe DAC have stated that their Board and management are continuing to engage with the Central Bank of Ireland in relation to the supervisory engagement process, with a view to having the direction lifted as soon as possible, and that the Central Bank has confirmed that it will keep the terms of the direction under continuous review.
Naturally this is an unsettling occurrence. Nonetheless, provided there are no further adverse developments, the primary impact will be that solicitors firms covered by CBL Insurance Europe DAC may be required to obtain an alternative insurer for the 2018/2019 indemnity period, should the direction not be lifted by the Central Bank of Ireland.
Should the Central Bank lift the direction to cease writing business, CBL Insurance Europe DAC will still need to satisfy the prudent minimum financial rating requirements of the Law Society of Ireland in order to remain in the solicitor’s professional indemnity insurance market. It currently does so through a guarantee from a rated sister company.
Guidance for the profession on this matter can be found on the PII News section of the Society’s website. A copy of the guidance has been emailed to all managing partners covered by CBL Insurance Europe DAC today, for whom we have an email address. We will contact others by post.
The Society will continue to monitor the situation and any queries should be directed to the Society’s PII helpline at 01 879 8707 or email@example.com. The helpline is available Monday to Friday 10am to 4pm to assist with queries.