HUNDREDS of homeowners have been left without insurance cover if their homes develop structural defects following the failure of a Danish insurer.
Alpha Insurance filed for bankruptcy earlier this year. It had 12,000 customers here.
Last week 50,000 drivers had to get alternative insurance cover when another Danish insurer, Qudos, went into liquidation.
Now it has emerged that the failure of Danish regulated Alpha has left 1,600 homeowners unable to get alternative insurance.
The homeowners were covered for structural defects insurance, which was bought for them by the developers of their homes.
Fianna Fáil finance spokesman Michael McGrath said the homeowners were now left in the lurch and were vulnerable if their homes develop defects.
“This specific issue surrounds latent defect or structural warranty insurance which is typically taken out by the developer and protects the homeowner if major structural issues with the property emerge.”
Mr McGrath said the 1,600 homeowners were unable to get alternative cover.
“It is my understanding that homeowners are unable to take out replacement insurance themselves for homes that have been already constructed.”
He said this threatens to leave impacted homeowners completely exposed if serious structural issues with their house emerge.
The lack of such cover can restrict homeowners in selling their house.
He called on the Central Bank to clarify the matter.
Homeowners affected who had structural insurance with Alpha insurance were advised to contact the developer who built their house and to ensure that alternative cover has been arranged.
Mr McGrath added: “This is yet another example of a breakdown in regulation in the European insurance market. Only last week another Danish regulated insurance company, Qudos, went into liquidation and we are still coming to terms with the failures of Enterprise and Setanta.”
He said major reform is needed at a European level to protect customers and claimants when insurance companies fail.
In a Dáil reply to the Fianna Fáil TD, Finance Minister Paschal Donohoe said owners of properties unable to get new cover should contact their developer of their property.
Should there be a claim on a policy, there may be assistance available from the Danish Insurance Guarantee Fund in the first instance.
If such an application were unsuccessful, there may then be recourse to the Irish Insurance Compensation Fund, the Minister said.
Article Source: http://tinyurl.com/kbwqb42
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