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HIH Insurance

  
HIH Insurance Limited was a publicly listed company in Australia. Prior to its collapse in 2001, the HIH Group was the second largest general insurer in Australia and had operations in many other countries.

On 15 March 2001, HIH Insurance Limited and a number of its subsidiaries were placed into provisional liquidation. Subsequently, on 27 August 2001, the companies that were in provisional liquidation were placed into liquidation.

Schemes of Arrangement are now in place for eight of those companies.

The Scheme Administrators have made initial payments to certain creditors and will make further payments over the coming years.

Decision on the priorities to apply to non Australian assets – The House of Lords has handed down its decision that Australian priorities are to apply to the Insolvency of the HIH group. Download a copy of the English Scheme Administrators summary of the decision.

 
 
 
Scheme Administrators' estimate of ultimate Scheme Payments
Scheme Company
Estimated Final %
To Date
HIH
12% to 35%
11% and 18.12%*
FAIG
45% to 55%
40% and 41.2%**
CIC
55% to 65%
45%
FAIT
Less than 5%
nil
FAIR
100%
nil
FAII
8% to 30% ***
nil
WMG
30% to 95%
20%, 45% and 56% ****
HIHU
5% to 25% ***
nil
 
The above figures are preliminary estimates only. Final outcomes may vary considerably from these estimates, depending on reinsurance collected, development of future claims patterns, bad debt levels, other asset recoveries, the success of litigation, nature of claims and costs incurred.
* 18.12 cents in the dollar has been paid to HIH Casualty and General Insurance Ltd creditors with Insurance liabilities worldwide. 11 cents in the dollar has been paid to all other HIH Casualty and General Insurance Ltd creditors.
** 41.2 cents in the dollar has been paid to FAI General Insurance Company Limited creditors with Insurance liabilities worldwide. 40 cents in the dollar has been paid to all other FAI General Insurance Company Limited creditors.
*** the higher range estimate relates only to creditors with insurance liabilities.
**** The return to creditors with insurance liabilities in Australia reflects the fact that under the terms of the Scheme they will receive payment from Fund 3 (non-reinsurance assets in Australia) net of any Scheme payment they may have already received from Fund 1 (reinsurance assets in Australia) and Fund 2 (reinsurance assets not in Australia). In summary:
Creditors with Insurance liabilities in Australia: 56%
Creditors with insurance liabilities outside of Australia: 20%
Creditor with non insurance liabilities in Australia: 45%
 
 
 
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