Australia’s Catholic Church Insurance (CCI) has announced it will cease issuing new or renewal policies and enter into a “run off” due to a lack of sufficient capital contributions from shareholders.
Two years ago, the CCI was granted an AU$170m (US$117m) bailout. However, earlier this month it had been reported that the insurer was facing imminent collapse due to a surge in abuse claims, and that it would need additional funding to stay afloat.
That lifeline of additional funding never arrived. Chairman Joan Fitzpatrick said that, despite every effort, CCI could not secure the necessary capital to continue operations in line with regulatory requirements. “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,” said Fitzpatrick.
The Australian Catholic Bishops Conference has restated its commitment to “responding with justice and compassion to victims and survivors of abuse in Catholic settings”. It is supporting ministries currently insured with CCI to ensure continuity of insurance cover.
The Australian Prudential Regulation Authority (APRA) has also responded publically to CCI’s decision to enter run-off, stating it had noted the commercial decision and that it will continue to supervise the organisation closely.
Policyholders with contracts expiring in the coming weeks will be offered a short-term renewal up to June 30th, to allow them time to source alternate insurance arrangements.
CCI has served the Catholic community since 1911 and is one of the oldest insurance companies in Australia.