It seems to have passed the wider media by but MarketGuard, which offered mortgage borrowers insurance against future interest rare rises, has gone into administration.
A statement from the firm, quoted on the Mortgage Introducer website, said: “After failing to find replacement solvency funding MarketGuard insurance has ceased to write new business and will be entering a solvent runoff”.
Mortgage Introducer state that ‘the runoff will be managed by Quest Insurance Management in Gibraltar and overseen by the Gibraltarian regulator the Financial Services Commission’.
How will existing customers be affected ?
MaketGuard state that “the business model means that all risk is fully hedged and all future claims on existing policies will be met in full.”
In a market where it is widely believed that the Bank of England base rate will not be rising above current levels until 2016-2017, and venture capitalists being choosy, the news perhaps comes as no surprise. Lack of demand for a firm’s product coupled with funding issues will only end one way.