Irish insurer Quinn Insurance, a major underwriter of solicitors’ professional indemnity insurance (PII) policies in the UK, has today fallen into administration.

In a statement, the Irish Financial Regulator said that it has directed Quinn to cease writing new business in the UK. The statement said that existing UK policyholders will not be affected by this decision as existing policies will remain valid, and that customers can make claims in the normal way.

‘The effect of this action is to prevent Quinn Insurance Limited suffering further financial losses from its currently unprofitable UK business,’ the statement said.

The statement said that the Irish Financial Regulator ‘has commenced an investigation into certain matters within Quinn Insurance Limited that have very recently come to light’.

Quinn said in a statement: ‘This is deeply disappointing in the context of the continued profitability of the group which is currently in excess of €20m (£17.8m) per month. However, the regulator has seen fit to take this action in the context of a perceived depreciation of the underlying assets of Quinn Insurance.

‘We feel that this issue could have been resolved to the benefit of all in a relatively short space of time, and we will be working with the regulator and the provisional administrators to resolve all outstanding matters.

‘The business continues to trade as a going concern with the objective of ensuring a financial restructuring to safeguard the overall business in the longer term. All other group businesses are unaffected by this development.’

Frank Maher, partner at Liverpool firm Legal Risk, said the news would be a source of worry for solicitors who had PII cover with Quinn before retiring. ‘In practice, you can’t buy run-off cover from anyone other than the insurer in your last year of cover,’ he said.

The actions of the Irish Financial Regulator do not apply to the Quinn Life business, which is a separate entity.