FSCS protection for European Risk Insurance Company customers
28th April 2014
The vast majority of UK customers of European Risk Insurance Company hf (ERIC), which is now in default, are expected to be covered, says the Financial Services Compensation Scheme (FSCS).
This means that FSCS may be able to pay claims against the firm. FSCS is working with the resolution board1 of the firm to assess the position of UK policyholders who may qualify for FSCS protection and on the handling of claims.
FSCS protects policies taken out in the UK in respect of EEA risks and policies taken out in the EEA (including Iceland) in respect of UK risks.
More than 24,000 people in the UK may have insurance with ERIC.
FSCS will protect many of the policies ERIC sold in the UK to individuals, small businesses and any policyholder who purchased compulsory employers’ liability cover.ERIC sold a variety of policies which qualify for FSCS protection. They include:
- Home owner insurance
- General liability insurance
- Combined commercial insurance
- Professional indemnity insurance
- Employers’ liability insurance
The Scheme protects compulsory insurance, such as employers liability insurance, in full. FSCS protects other general insurance policies for 90% of the value of the claim with no upper limit.
FSCS Chief Executive, Mark Neale, says: “We’re working closely with ERIC’s resolution board in Iceland on paying claims. FSCS will pay any protected claims as quickly and efficiently as possible. For the time being we understand existing policies remain in force.”
If ERIC policyholders have questions about their policy they will contact either their insurance broker or the European Risk Insurance Company on email: email@example.com.
FSCS will publish updates on its website as necessary.
Notes to editors
1 The resolution board was appointed on 12 February 2014 by the Icelandic regulator, the Financial Supervisory Authority (FME), to assume all the powers of ERIC’s board of directors and to manage ERIC’s affairs in consultation with the FME.