Bulgarians take to the street as Cyprus’ Olympic Insurance goes bust

By Stelios Orphanides

The liquidation of Cyprus’ Olympic Insurance, while largely unnoticed on the island, is sending shockwaves in Bulgaria as it leaves almost 200,000 policyholders with no coverage and threatens to hurt bilateral relations, according to press reports.

On Monday, Bulgaria’s foreign minister and deputy prime minister Ekaterina Zakharieva summoned Cypriot Ambassador to Sofia Marios Kountourides to discuss the matter and demanded an immediate meeting with Bulgaria’s Financial Supervision Commission (KFN) with Cypriot finance ministry officials, Bulgaria’s 24chasa.bg news site reported on Monday.

Prime Minister Boyko Borissov is scheduled to attend an extraordinary parliamentary session that will be held on Tuesday in response to the crisis which also prompted a number of affected Olympic customers to participate in a protest in Bulgaria’s capital on Monday, Reuters reported.

Cyprus’ Insurance Companies Control Service, a division of the ministry of finance which supervises insurance companies, decided to place Olympic in liquidation last week, three months after it barred it from entering new contracts with customers citing capital requirements issues.

Finance Minister Harris Georgiades did not respond to a request for comment. The Insurance Companies Control Service could not be reached for comment late Monday afternoon.

A government source who spoke on condition of anonymity said that the Cypriot ambassador was invited to a “briefing and to discuss the matter” and added that the ambassador is in contact with Superintendent of Insurance Victoria Natar for further steps.

Olympic, owned by Luxembourg’s Hispakol S.A. which in April announced the acquisition of an online education service provider from Spain’s UGT for €17m, informed policyholders in Cyprus last week of this development by text message and provided a contact number. The number was unreachable, an Olympic customer told the Cyprus Mail on Tuesday.

According to Reuters, the Bulgarian chief prosecutor ordered an investigation into whether KFN had properly supervised Olympic’s operations in the east Balkan country adding that KFN had also prohibited the company from entering new business in May after Cypriot authorities silently did so.

Olympic owes 9.4m Bulgarian levs (€4.7m) to 197,551 customers in Buglaria for the early termination of their motor third-party liability policies, Reuters reported citing Ralitsa Agayn, KFN’s chairwoman. While the value of affected policies is around 40m Bulgarian levs, many of the contracts provide monthly payments, thus reducing the overall impact.

According to 24chasa.bg, ambassador Kountourides assured the Bulgarian foreign minister that “it is not politicians but (instead) people come first, so the two governments need to do whatever is possible to resolve the matter”.

“Our relations to Cyprus are excellent and I hope to have your cooperation,” Zakharieva countered. “What we need to do is react as fast as possible”.

The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.