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PACICC - The Plan
- designed to provide a reasonable level of recovery for claims of most P&C policyholders
- excludes life (own plan), aircraft, credit, crop, … (distinctive), MA SK, QC BI auto (govt)
- all participating insurance companies are members (all registered); can’t withdraw
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Procedure after an insolvency
- PACICC representatives consult with court appointed liquidator
- PACICC is not called upon to make any payments until after the winding-up order
- major accounting firms tend to be invited, except the auditor of the insolvent insurer
- PACICC has discretion to make payments to third parties
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Payments under PACICC
- maximum recovery is $250K for all covered policies (except pers. property, max $300K)
- UEP is covered 70%, for a maximum eligible premium of $1,000 ($700 recovery)
- claims by persons having special relationship with insolvent insurer may be excluded
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Assessment process
- levelled against particular participating insurers licensed in the participating jurisdiction
- separate assessments are made in respect of market share for each jurisdiction
- assessments are limited to shortfall between amounts advanced and recovered
- also allowed to collect some pre-insolvency funding
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4 financing mechanisms
- assessment of participating insurers
- a compensation fund
- liquidated assets of the insolvent insurer
- recoveries from third parties
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