Vitis: What next for Quinn?
A general history of Irish insurance makes for interesting reading. PMPA ended up in the fold of Axa, Eagle Star acquired Irish National and the Insurance Corporation of Ireland became part of Allianz. Where is Quinn Insurance going to end up?
It could very well go the way of its predecessors and be taken over by a multinational. Could the moral of the story be that indigenous insurance firms cannot survive in an era of globalisation or are there factors at play that are more specific to the Irish way of doing business?
The insurance industry is a heavily regulated market. It is now obvious that Sean Quinn was playing hard and fast with some of the rules in an effort to divert cashflows from his insurance company into propping up other parts of his business. The backlash has so far been a very public outcry from Quinn employees understandably concerned about their futures.
But what about the hundreds of thousands of policy holders? And more importantly, what about the reputation of Ireland Inc and its viability as a location for international financial services?
The Financial Regulator Matthew Elderfield was right to wrest control of Quinn Insurance away from the wider group. From now on there will be strict regulatory framework. The success or otherwise of domestic and international insurance companies hinges on staying within those rules.