Thousands of UK motorists have been left in a precarious position after their insurance provider suddenly collapsed. The Gibraltar-based Premier Insurance Company Limited has entered administration, leaving approximately 16,000 policyholders without valid cover for their vehicles.
Urgent Warning Issued to Policyholders
The Financial Conduct Authority (FCA) has issued an urgent warning to affected customers across the United Kingdom. Policyholders are being told they must secure alternative insurance arrangements immediately to avoid severe legal penalties for driving while uninsured.
Premier Insurance Company Limited entered administration in October following an application to the Supreme Court of Gibraltar. The firm, which primarily served the UK market, sold motor insurance policies to both individuals and small businesses. Its decline had already begun, with the company ceasing to write any new business as far back as January 2025.
Policy Termination and Limited Protection
Administrators from the firm Grant Thornton took the decisive step of formally terminating all remaining insurance policies on 1 December last year. This action rendered the protection for vehicles and business operations inactive. Any policies that were not cancelled earlier are set to expire definitively by the end of this month.
The FCA has cautioned that the specific type of policy held will impact the level of claim coverage available. While some protection exists through the administration process, full policy values are not guaranteed.
Eligible UK customers do have a safety net in the form of the Financial Services Compensation Scheme (FSCS). However, financial experts stress that this scheme is designed to cover losses, not necessarily the total value of the original insurance policy.
The Serious Risks of Driving Uninsured
The consequences of driving without valid insurance in the UK are severe. It is a serious offence that carries significant legal and financial risks. Anyone caught driving without appropriate cover faces:
- A fixed penalty of £300.
- Six penalty points added to their driving licence.
- The potential for their vehicle to be seized or even destroyed.
For the 16,000 individuals and businesses formerly insured with Premier, finding a new provider is not just a matter of convenience but a critical legal necessity to stay on the right side of the law.
