Lemma Europe Insurance Company Ltd has gone into liquidation, the Gibraltar Financial Services Commission has confirmed.
The Insurer provided many elderly Park Home residents with a specialist scheme for Britannia Parks Ltd (before it was acquired by the Regency Park Life Group) through Cobra Insurance Brokers. It provided residents on Britannia Parks and Kings Park Village a bespoke Park Home Insurance Policy with ‘guaranteed savings for Kings Park Village Residents’ with options of Essential, Superior and Ultimate Cover, yet this is probably a good example of ‘if something seems too good to be true, it probably is’.
Park Home Assist Insurance Services have been providing Residential Park Home Insurance to Park Home Residents for a number of years, and the policy provided by Park Home Assist is a Lloyd’s insured scheme to provide our policyholders that added ‘peace of mind’.
As for Lemma Insurance, Frederick David John White of Grant Thornton Accountants (Gibraltar) was appointed provisional liquidator by the Supreme Court of Gibraltar.
The Gibraltar Financial Services Commission had made a request after an investigation uncovered a detiorattion in Lemma Europe’s finances and corporate governance.
On the 17th September the Court granted the GFSC leave to do so, and a petition was presented to the court on 19th September. A summons was also issued for the appointment of a provisional liquidator.
On the same day, and in order to protect the assets of Lemma pending the appointment of a provisional liquidator for the company, the GFSC issued a further direction to Lemma that the company may not make any payments from its bank accounts.
On the 28th September the Supreme Court of Gibraltar heard the petition and appointed White as provisional liquidator of Lemma Europe Insurance Company.
The GFSC stated that is was forced to protect policyholders by seeking the company’s liquidation after shareholders refused to contribute additional capital and one of its major reinsurers and sister company, the Ukranian company Joint Stock Insurance Company Lemma, failed to honour its reinsurance agreements with Lemma Europe and stopped all reinsurance claims payments to the company.
This placed Lemma Europe’s finances on an ‘unviable footing’. The provisional liquidator has been granted very wide powers by the court, enabling him to do whatever he considers necessary to protect the interests of policyholders.
A GFSC spokesman said ‘The company’s immediate problems and the need for the commission’s actions are external to Lemma Europe and Gibraltar in that, in the opinion of the commission, they are primarily the result of the actions and defaults of a related insurance company, Lemma Ukraine, which is located in Kiev.
For any client who is affected by the problems created by Lemma Europe, they can be assured if they contact Park Home Assist Insurance Services we will provide a Lloyd’s insured Park Home Scheme.