Comments on: Enemalta and Alfred Mifsud’s insurance company

By: Ghoxrin Punt

Ghoxrin Punt — Tue, 18 Nov 2014 22:07:41 +0000

In reply to Camilla.

Daphne, whilst you are right in what you say, that the client knows Allcare and will expect payment upfront, an insurance company would not necessarily retain a large portion of the risk.

One can but assume, or hope in this case, that Allcare has reinsured this facultatively, ie that it has reinsured substantially all of the risk to the reinsurer.

Allcare’s earning on this deal would not be the premium but the commission it will receive from the reinsurer.

However having said that, it is a known fact that Allcare had had problems obtaining reinsurance in general because of the manner in which it is pricing. Whether they gave obtained reinsurance on this Enemalta risk and with whom is clearly an unknown at the moment.

This position will change come the introduction of the new capital requirements, when the capital Allcare will require will depend on the underwriting risks it takes and the quality of its reinsurers, amongst other things.

To the person who made reference to the MFSA, I am sorry but it is the responsibility of Enemalta to ensure that it has a solid insurer.

Enemalta is a business, and the sort of business that should have a risk manager, a risk committee and a responsible board, the fact that it does not is not the MFSA’s problem but the Minister’s problem. And we know the capabilities, or lack of, of this particular Minister.

By: nutmeg

nutmeg — Tue, 18 Nov 2014 19:20:32 +0000

An inflatable company, set up just for the years of great abundance.

By: Jonahan

Jonahan — Tue, 18 Nov 2014 19:08:02 +0000

I would like the prime minister to explain what he meant when he said repeatedly: Malta taghna lkoll.

By: Jonahan

Jonahan — Tue, 18 Nov 2014 19:07:12 +0000

I think the candle needs to be lit by all the clients of Allcare who are supposedly buying insurance for peace of mind.

How can you have peace of mind when you are insuring with a company that is sustaining such a loss?

By: Bryan

Bryan — Tue, 18 Nov 2014 15:42:04 +0000

It’s not only Eric Schembri who should light a candle in case his company burns up in flames but all Malta should light a massive candle too.

Unless Allcare Insurance have re-insured massively how will the money spent by taxpayers be reimbursed in case of a major claim?

By: U Le!

U Le! — Tue, 18 Nov 2014 14:38:40 +0000

I am keeping a lighted candle myself, praying that no lighted candles come close to any gas-powered power stations.

By: Volley

Volley — Tue, 18 Nov 2014 14:31:19 +0000

This is the credo of the present government: “Ahtaf, ahtaf, kompli ahtaf u li jifdal ahtfu wkoll !”

By: Lizz

Lizz — Tue, 18 Nov 2014 14:20:07 +0000

Or (for all that matters), that the candle in front of the Madonna, does not blow out.

By: Camilla

Camilla — Tue, 18 Nov 2014 14:07:56 +0000

If you worked in and understood insurance, you would know that all insurance companies re-insure a percentage of every risk with international insurers so as to contain their exposure!

[Daphne – “If you worked in and understood insurance”. There will be a few people, who know who’s who, who will be reading that and laughing right now. But for the benefit of my readers: every insurance company SHOULD have reinsurance protection – but the extent and adequacy of that reinsurance protection in relation to the risks underwritten by Allcare Insurance is known only to Allcare Insurance itself.

Even so, the risk is ultimately underwritten by Allcare Insurance itself, and its clients ‘know’ only Allcare. They do not know how much of their risk Allcare Insurance has reinsured. If risk becomes reality, it is Allcare Insurance who clients will ask to shell out for claims.

Whether Allcare Insurance can then succeed in recovering part of its pay-outs from its reinsurers is another thing.

Also, there are different qualities of reinsurers, and beyond that, when taking out reinsurance an insurer generally retains a substantial part of the risk itself. Looking at Allcare Insurance’s dismal performance – almost a million euros lost in its first year of operations – you just have to wonder how the company’s cash flow will be able to take substantial pay-outs while waiting for reinsurance to kick in.

Even strong insurers have gone bankrupt despite reinsurance cover – they still went down.]

By: Katrin

Katrin — Tue, 18 Nov 2014 13:06:29 +0000

In reply to Tabatha White. Fenomenali!