John Cusolito, a Liberty Mutual spokesman at the company's headquarters in Boston, would only say the company's "public comment regarding Quinn Insurance is that we have expressed our interest to the administrators."
The Dublin office of international accounting firm Grant Thornton has been named administrator of Quinn Insurance.
"We have received a substantial number of expressions of interest [in Quinn Insurance]," said Michael McAteer, a partner in Grant Thornton. "We're not commenting on who's in there, who's not in there."
The Irish Financial Regulator had sought the administration order to protect what it said were the interests of policyholders.
The problems of Quinn Insurance have been linked to large debts to Anglo Irish Bank, which has been taken over by the Irish government. Problems within the bank have been blamed largely on the downturn in the Irish housing market.
The appointment of Grant Thornton was made under terms of Ireland's 1983 Insurance Act, McAteer said.
Grant Thornton, McAteer said, has announced a 15-month job reduction program for Quinn Insurance that will cut its work force of 2,474 by 900. He estimated the insurer's share of the Irish household and motor market at about 20%. He put the company's market share in Britain, apart from Northern Ireland, at about 2.5%. Quinn Life, which is separate from Quinn Insurance, has not been affected by the administration order.
"We are charged with taking control and managing the business as a going concern and returning the company to a sound financial footing," McAteer told BestWire.
Grant Thornton, McAteer added, is gathering information for the regulator on the possible sale of Quinn Insurance. He expects the regulator to appoint a merchant bank to guide the deal. "That process will kickstart in the very near future," McAteer said.
The administrator's role will end, McAteer said, when it believes "the investment puts the company on a sound financial footing. That is in such things as solvency, balance sheet, access to capital, etc."
In reducing employment at Quinn Insurance, McAteer said, the administrator is looking at "resizing the business to more correctly align itself to the level of business that we're writing."
All seven of the insurer's locations will be affected by the job cuts, McAteer said. These are in Enniskillen, in Northern Ireland; Manchester and London, in England; and Cavan, Navan and two locations in Dublin, all in the Irish Republic.
"We are now looking to the next stage, which would be the more longer term future of Quinn Insurance Ltd.," McAteer said.
The aim of the Irish statute is to protect the policyholders, McAteer said. This is in contrast to U.K. law, which focuses on questions of insolvency, he added.
The administrator, which has the power to sell the business and its assets, is answerable to the High Court rather than the Financial Regulator, McAteer said. The process, he noted, does not have a timetable. "It takes as long as it will take," he said.
Grant Thornton's initial concentration, McAteer said, was on such day-to-day operational issues as providing information to the Irish regulator regarding its decision to ban Quinn from the U.K. market. Quinn, which was never forced to stop operating in the Irish market, has been permitted to return, in stages, to the U.K. motor market.
"We've now sent a business plan [to the regulator] in relation to commercial," McAteer said.
This is the fourth time the provisions of the 1983 Irish legislation have been invoked, McAteer said. The first, in 1983, involved the rescue of the Private Motorists Protection Association, which dominated Ireland's motor insurance market. It was PMPA's plight, McAteer said, that caused the legislation to be rushed through. In 1985, an administrator was called in after the failure of the Insurance Corp. of Ireland, better known as ICI.
The 1983 legislation established a central fund that was supported by a 3% levy on insurance premiums, McAteer said. The fund was designed to protect insurance customers in case of insolvency, he added.
While PMPA and ICI were "wholly insolvent," McAteer said, there is a strong possibility that Quinn Insurance is solvent. "But in the event that it wasn't solvent, we would have access to the fund," he said.
Joe Plumeri, chairman and chief executive of Willis Group, expressed concern at the problems facing Quinn Insurance during a recent visit to London to attend the annual conference of the British Insurance Brokers Association.
"We're keeping a close eye on the fate of the Quinn Group," Plumeri told the conference. "It's the story of an Irish empire born from Sean Quinn leaving school at age 14 to haul gravel from his family farm. It's become one of Ireland's largest employers. But now it's headed into bankruptcy and 1,000 of the 2,400 work force at Quinn Insurance might soon lose their jobs."
McAteer said Quinn Insurance's effective presence in three jurisdictions -- the Irish Republic, Northern Ireland and Britain -- has not complicated Grant Thornton's task unduly.
"The company was very much integrated in its approach," McAteer said, noting the head office in Enniskillen was responsible for the entire business, while claims were processed in Manchester, Cavan, Navan and Dublin.
The possession by Quinn Insurance of a passport to operate throughout the 27-member European Union would be an attraction to a potential acquirer, McAteer said. Another plus, he said, is the location of many of the operations in low-cost environments rather than in Dublin, which is expensive. The company has also invested in broadband infrastructure, which could accommodate expansion, he said.