Gibraltar Financial Services Commission warns Elite Insurance policyholders of policy disclaimers and proposed scheme enabling FSCS compensation until expected 31 December 2027

The Gibraltar Financial Services Commission published an update for policyholders and intermediaries of Elite Insurance Company Limited, which has been in administration since 11 December 2019, highlighting that the Joint Administrators have disclaimed Elite’s insurance policies and that a court-approved scheme of arrangement is being pursued to close the business and handle claims. Under the Gibraltar Insolvency Act 2011, the Joint Administrators have disclaimed all Elite policies except UK policies where the policyholder is eligible for protection by the UK Financial Services Compensation Scheme (FSCS), with the disclaimer terminating the contract. The proposed scheme of arrangement could affect policyholders’ legal rights and how existing and future claims are dealt with, including claims arising from the disclaimer. An arrangement with the FSCS would allow eligible customers to access FSCS compensation, subject to a valid claim, up to an expected cut-off date of 31 December 2027, after which FSCS-protected policies would be treated as disclaimed, but only if the scheme is successfully implemented. Policyholders and brokers are directed to review the Practice Statement Letter explaining the scheme’s implications and to register for updates on the scheme process.