11 Apr 2011

AMI would be receivership without Govt support - PM

2:28 pm on 11 April 2011

Prime Minister John Key says AMI would have gone into receivership without government support.

The Government provided a $500 million backstop package last week after the Christchurch insurance company admitted it might not have enough in reserves to pay insurance claims from the earthquake on 22 February.

AMI's credit rating was downgraded from A+ to A- by AM Best in March.

Mr Key said on TVNZ's Breakfast programme on Monday that the company's prospects could have been a lot worse if the Government had not given AMI a letter of support to take to the ratings agency.

The company would have gone into receivership if the Government had not stood behind it, he said.