An urgent warning has been issued to thousands of motorists across the UK who are set to lose their car insurance cover from Monday, December 1.
Insurance Firm Collapses into Administration
Premier Insurance Company Ltd, which underwrote policies for approximately 16,000 car and van drivers, collapsed into administration in October. The Gibraltar-based firm's failure leaves its UK-based customers without valid cover as of the start of December.
The Financial Conduct Authority (FCA) has directly warned the firm's customers that they will no longer be insured. The regulator confirmed that the insurer has stopped paying claims in full.
Financial Safety Net Steps In
The Financial Services Compensation Scheme (FSCS) is now stepping in to protect eligible policyholders. This government-backed safety net is expected to cover over 16,000 individual customers and small businesses with an annual turnover of less than £1 million.
Sarah Marin, Chief Customer Officer at the FSCS, sought to reassure affected drivers. "We understand customers will be worried about how Premier Insurance Company Limited’s failure will affect their motor insurance policies," she said.
"We’d like to reassure customers that FSCS is working closely with the Insolvency Practitioner, Grant Thornton (Gibraltar) to make sure all eligible UK policyholders are protected."
Marin confirmed that the FSCS will continue to consider claims against the terms of the original policies for those who are eligible.
What Affected Drivers Must Do Now
The FSCS has established a dedicated page on its website with a comprehensive question-and-answer section for concerned policyholders. Customers who are unsure if their policy was underwritten by Premier Insurance Company Limited are advised to contact the insurance broker that sold them the policy immediately.
The scheme has stated it is working with regulators and partners to monitor the situation and minimise the impact on both customers and the wider industry. The FSCS will provide further updates on its website as developments occur.
This collapse serves as a stark reminder for all drivers to check the security and underwriter of their insurance policies, especially with the Financial Conduct Authority maintaining a register of authorised firms on its website.
