Australia’s HIH Insurance has placed itself in provisional liquidation following its failure to obtain sufficient funds to continue operations.
Administrators at KPMG, an international accounting and consulting firm, will begin the runoff, repaying policyholder claims and creditors, notably Wespac Bank, which is owed $102 million.
Rating agency Standard & Poor’s, which began downgrading HIH last November when HIH began discontinuing lines and selling off portions of its business, announced that the company would no longer be subject to continuous surveillance following a request by HIH to discontinue the ratings.
Germany’s Allianz acquired about half of HIH’s personal lines business in September, and Australia’s NRMA recently took over its workers’ compensation operations. The company has so far raised around $250 million that will be administered by the liquidator.
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