Letter to private Alpha Insurance Customers
Dear Policy Holder,
RE: Alpha Insurance A/S Bankruptcy - We’ve got you covered!
We wrote to you recently informing you that your Alpha policy will terminate on the 11th August under Danish law. At the time that we were working with the Financial Services Compensation Scheme (“FSCS”) and the Danish Guarantee Fund (“DGF”), to put in place a replacement policy to provide cover through to the original end date of your Alpha policy.
The FSCS has confirmed that you are eligible under the Policyholder Protection Rules, which means we can now confirm we have put in place replacement cover for you with the same policy benefits.
Enclosed is your new policy document and schedule of cover. The policy is underwritten by Syndicate 1991 at Lloyd’s. Lloyd’s is regulated by the Prudential Regulatory Authority in the UK and offers excellent security to its policyholders. As FSCS has funded your replacement policy, your right to claim in Alpha’s insolvency has been automatically transferred to FSCS.
What do I need to do now?
These are your options:
1. To accept the replacement policy you don’t need to do anything, your replacement policy will come in to force on the 12th August and your new schedule of cover and policy document are enclosed.
2. If you choose not to accept this replacement policy, please call us on +44 (0)3333 010 750 or write to us at the address above by the 10th September 2018. If you cancel the replacement policy before the 10th of September (within the 30 day cooling off period), you will not have any replacement insurance but you may be able to claim compensation from the FSCS in respect of the premium that you originally paid for your Alpha Insurance policy. More details on the FSCS and how they are assisting Alpha customers can be found at: https://www.fscs.org.uk/what-we-cover/products/insurance/alpha-insurance-as-declared-bankrupt/
3. If you wish to cancel your replacement policy after the 10th September 2018 you can do this at any time. You will receive a pro-rata refund for the unexpired period of the policy based on the amount that has been paid on your behalf by the FSCS to secure this replacement policy less a £25 cancellation fee. You will not be able to claim compensation from the FSCS in respect of the premium that you originally paid for your Alpha insurance policy. The replacement policy cost is shown in your schedule.
If you are thinking of cancelling and buying a product elsewhere, we recommend that you first check the market to ensure any replacement would adequately meet your needs. You’ll need to consider the cost of the replacement policy, the level of coverage and any significant exclusions and limitations.
You should also be aware that if you cancel your replacement policy, we will not be able to reinstate it.
We have enclosed some FAQs for further information about your policy. These are also available on our website at www.premiasolutions.com. If you still have any questions, please call our customer services team on +44 (0)3333 010 750.
Premia Solutions Limited
FAQs for Alpha Insurance A/S Policy Holders
Why is Alpha Insurance A/S no longer underwriting my policy?
Alpha Insurance A/S was declared bankrupt on 8th May. Under Danish law, all policies will terminate on 11th August 2018. Further information can be found on FSCS’ website at www.fscs.org.uk/what-we-cover/products/insurance/alpha-insurance-as-declared-bankrupt/
Who are FSCS and the DGF?
Your Alpha policy is protected by FSCS - the Financial Services Compensation Scheme. FSCS deals with compensation claims when UK financial services go out of business. It is an impartial, free service that was set up by Parliament to protect customers. You can find out more about FSCS and the cover they provide can be found on their website at www.fscs.org.uk. If you are a private individual, as opposed to a business, the Danish Guarantee Fund (“DGF”) will also to contribute to your replacement policy. The DGF is the FSCS equivalent protection fund in Denmark, where Alpha Insurance was based.
Why am I receiving this letter?
When you purchased your vehicle, you also purchased an insurance policy which was underwritten by Alpha Insurance A/S (“Alpha”). Alpha was declared bankrupt on 8th May. As your policy’s Administrator, we have worked with the FSCS and the DGF to put in place replacement cover for you with a new insurer, DTW1991 which was paid for by FSCS.
Do I need to pay for the replacement cover?
No, Premia Solutions has worked with FSCS and the DGF on an arrangement for them to pay for the cost of the replacement policy.
If I do not wish to accept the replacement cover, can I cancel my policy?
Yes, you can cancel within 30 days of the replacement policy coming into force and you may be able to claim compensation from the FSCS. To cancel your policy please contact our customer services team on +44 (0)3333 010 750, or write to us at Premia Solutions Limited, 3 Corunna Court, Corunna Road, Warwick, CV34 5HQ.
Will there be any difference between the cover under my new policy and my previous policy?
No - your cover is a replacement policy with the same policy benefits and end date as your Alpha policy. The only differences will be the insurer and the complaints process.
Can I buy this insurance elsewhere?
Your product was designed, in conjunction with your dealer, to provide you with the best possible cover.
If you are thinking of cancelling and buying a product elsewhere, we recommend you check the market first to ensure that you have the same level of cover that is available at the time of buying a new vehicle. You’ll need to consider the cost of the replacement policy, the coverage, any significant exclusions and limitations in order to make an informed choice and to ensure that it adequately meets your needs.
If you cancel your policy within the 30 day cooling off period, we will have to pay back the funding received from FSCS.
I have an outstanding claim on my policy, what happens now?
If you’ve submitted your claim, and all of the documents that we requested were submitted, it will be assessed as normal, according to the terms and conditions of your policy. We’ll be in touch with you in due course to advise on the progress of your claim. Claims are usually assessed within 10-15 working days once we receive all of your documents. As Alpha has been declared bankrupt, your claim may fall to FSCS or the DGF to pay if you are eligible.
Can I claim a return of premium in Alpha’s insolvency, for example, using the portal set up by Alpha’s liquidator?
No. As FSCS funded your replacement policy, all of your rights against Alpha, and any third party involved in or connected with any claim made to FSCS under the Policyholder Protection Rules, have been automatically transferred to FSCS under Rule 12.2 of the Policyholder Protection Rules.