Over the past few years, there have been rumors about the financial stability of Quinn Insurance in the UK. They are a fully fledged insurer underwriting motor, professional indemnity, business and commercial liability insurance.

When you work in the industry, you become aware of companies that undercut anyone and everyone and wonder how long they can survive. But, you cannot be seen to be questioning their financial stability because you could be faced with a libel or slander lawsuit, without real proof. So, you just continue to operate and when you lose business to Quinn at extremely uneconomic rates you just have to bite your lip and get on with your job.

Now though, the end of the road has arrived, for their UK division anyway. As of the 30th March 2010, they are no longer allowed to underwrite any new business or renew any policies for UK mainland customers.

Administrators have been appointed, which follows intervention by the Irish Financial regulator.

The regulator has ordered Quinn Insurance UK to stop writing new business after the High Court today appointed joint provisional administrators to Quinn Insurance Limited.

The Financial Regulator has acted in the interest of the firm’s policyholders and added that current UK policyholders are not be affected by this decision as their policies remain valid. Customers can continue to make claims and should not stop paying their premiums.

Any UK business that has a policy with an inception date prior to the 30th March will continue to have their insurance cover until the expiry date of the policy. If you have a quote from Quinn, and are looking for an alternative, then you need to speak to a UK based independent business insurance broker. Given the recent history and pricing that Quinn have been aggressively pursuing, there is no guarantee that a cheaper alternative can be obtained.

What a broker can do though is to find a suitable alternative so that at least you can ensure that you have cover in place.

This may have wider issues in the UK commercial insurance market. Prices have been unsustainable, according to insurers, for a while now. Whilst Quinn has not “gone bust” they have had their fingers burned in a similar way to Independent insurance. They chased the higher risk business (young drivers and commercial liability insurance) and charged incorrect prices.

The regulatory authorities, whatever you may think about them are doing the right thing. It is their job to constantly review solvency ratio’s and if they think there is a chance that a business (insurer) may not be able to, or have difficulty in meeting it’s liabilities, then they are entitled to step in. We do not expect any other companies to go through a similar route as there is more to the Quinn problems than poor underwriting and pricing. What we do expect to see is insurers toughening up on their pricing so that they can take active steps today, to stop them going the same route as Independent or Quinn.

This is not bad news though because, even if your existing renewal goes up, you can still get a decent price by asking a broker to go out to the market and compare business insurance quotes for you. There are a small minority of cases where this is not true, but in the vast majority of cases a better premium, for similar cover, is always out there. You just need to know where to look.