Quinn Insurance workers braced for job cuts

Beleaguered Quinn Insurance’s 2,400 workers were bracing themselves today for hundreds of job cuts despite the company being cleared to reopen some private motor business in the UK.

Amid intense pressure from politicians and workers‘ representatives, the Financial Regulator granted a slight reprieve last night, but effectively hit traditional unemployment blackspots with crippling lay-offs.

After being renowned for cheap cover, workers‘ representatives claimed quotes were set to rocket by up to 50% under the watchdog’s rules, shattering the Quinn reputation of low-cost insurance.

The move leaves the UK commercial insurance wing closed and is likely to lead to more than 800 redundancies with the majority of cuts likely to hit the company‘s biggest centres in Dublin, Cavan, Navan and Enniskillen.

Briefings expected to be held at the four operations centres could see about of a third of the firm’s 2,400-strong workforce lose their jobs.

Workers’ representatives claimed 50 investors had expressed interest in Quinn Insurance but warned the shutdown had cost the firm 62,000 new customers so far, or 2,000 every day.

They also claimed the ban had been costing the company €1.5m a day.

Affected staff are expected to be offered voluntary redundancy over 18 months, with management seeking some lay-offs in the shorter term.

Taoiseach Brian Cowen said he shared people’s concerns about job losses.

“Obviously to try to bring some clarity and certainty to the situation as soon as possible is in the interests of all employees,” he added.

“We will work and do whatever we can in using our state agencies where that’s required and necessary.”

However, Mr Cowen also warned it was important to recognise the Financial Regulator’s independence.

Regulator Matthew Elderfield said the decision to allow some UK business to reopen was taken after careful consideration.

“This decision has been made following detailed discussions with the Financial Services Authority (FSA) in the UK and joint administrators of Quinn Insurance Limited and permits the reopening of certain motor business lines of QIL UK,” he said.

Administrators Grant Thornton warned private motors accounted for a significant majority of UK business pre-administration.

It is feared the move to hike premiums – introduced to guarantee profitability - will ultimately cost Quinn clients.

Earlier this month, the High Court in Dublin appointed Paul McCann and Michael McAteer, of Grant Thornton, as permanent administrators to Quinn Insurance after Mr Elderfield raised concerns about its solvency levels.

The employees claimed it was the victim of double standards with rival insurer VHI granted time to improve solvency levels on separate occasions.

The firm’s UK division was shut down but Mr Elderfield allowed it to reopen for provisional driver business last week while liaising with administrators about reinstalling other product lines.

The Quinn Group employs more than 8,000 people across the UK and Ireland through the flagship insurance firm and cement, quarry, glass and property businesses.