Protector Forsikring

Legal Proceedings Report • Jul 5, 2019

Arbitration panel decides against Protector’s view

Arbitration panel decides against Protector’s view

The panel decided against Protector’s understanding of how the reinsurance contract covers the financial property loss following the tragic fire in Grenfell Tower.

Protector has not booked any reserves for this outcome in previous quarters. The company’s Q2 results will include a loss of MGBP 6,9.

The panel did not award legal costs. The panel states that “In making its decision on the apportionment of the parties’ cost the Tribunal has inter alia emphasized the outcome of the case, the complexity of the matter and how uncertain the determination of the dispute has been” and “Protector had good reasons to bring the matter to arbitration”

As Protector is of the opinion that the company has relied on advice from our professional broker, the loss will be discussed with them in the near future.

The conclusion from the Arbitration panel is surprising to Protector, but cannot be appealed. The result will not have any further consequence on Protector’s reinsurance accounts. There are no reinsurance exposures with the same structure as RBKC and Grenfell Tower, and future losses are covered on a different basis where the issues in dispute are not relevant.

It is unfortunate that this dispute has generated additional negative attention to the terrible human tragedy of Grenfell Tower. Protector has a firm commitment to handle the remaining process of the Grenfell Tower claim with integrity and quality. The company also remains committed to the long term plans for the UK operations.

Our client, Royal borough of Kensington and Chelsea was not party to the reinsurance dispute and the outcome will not affect the handling of the losses with the borough.