The board of Catholic Church Insurance (CCI) in Australia has announced its decision to wind down its business and voluntarily enter run-off.
The decision comes after CCI failed to receive enough capital from shareholders to keep its business afloat in accordance with regulatory specifications.
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The company will employ its existing capital reserves to continue to manage current policyholders’ claims.
However, it will stop issuing any new or renewal policies for its entire insurance operation.
CCI will help the policyholders, whose contracts will end in the coming weeks, with a short-term renewal up to 30 June 2023.
This will give the impacted policyholders time to make different insurance arrangements.
CCI chair Joan Fitzpatrick said: “The CCI Board and management deeply regret that it has been necessary to make this decision and would like to assure all staff, policyholders and suppliers that it has sufficient assets to meet its commitments as they currently stand.”
Earlier this month, CCI stated that it was holding talks with shareholders about the shutdown of new and renewal general insurance business as there was a dearth of additional flow of capital.
In a separate development, Australian Prudential Regulation Authority (APRA) said that it will supervise CCI after its decision to enter run-off.
APRA said in a statement: “APRA’s mandate is to supervise financial institutions so the community can have confidence in those institutions and that they are able to meet their prudential obligations.
“APRA will continue to closely supervise CCI.”
