20/07/2010

By Graham Buck

Eurotunnel has warned that a dispute over insurance payments resulting from a major fire in 2008 could result in the first annual loss since its restructuring three years ago.

The group that operates the Channel Tunnel faces compensation demands from users Eurostar and rail freight operators for losses resulting from the disruption of services following the blaze.

Eurotunnel has already received £132.5 million from its insurers for losses caused by the fire, which resulted in one section of the tunnel being out of use from September 2008 to February 2009.

The group maintains that it is owed a further £40.5 million, and payments have been blocked since May 2009 because of a dispute over responsibility for the fire.

Jacques Gounon, executive chairman, reported that traffic and revenues had increased despite the economic downturn but warned “If our insurance payments remain blocked, we shall be unable to declare a profit this year.

“It is clear that today the insurance firms, which have very well supported the company in 2008-2009, are now in a waiting attitude.” A spokeswoman for Eurotunnel said the group’s main lead insurer was XL Group, with Scor and Axa also in a consortium.

Other stories you may find of interest:

Africa 'offers massive scope for microinsurance'
Little morer than 2% of Africa's 700 million working poor are covered by insurance, representing a vast untapped opportunity for social and economic development, suggests a new study by the Microinsurance Innovation Facility of the International Labour Office (ILO).

Budget raises IPT to 6%
Insurance premium tax (IPT), currently 5% on most classes, will increase to 6% from January 4, the chancellor George Osborne announced in his Emergency Budget.

Solvency II off course, says AIRMIC
The Solvency II reforms in their present form would increase the cost of insurance to UK business and reduce available capacity, warns the Association of Insurance and Risk Managers (AIRMIC).