MCE Insurance, once one of the UK’s leading motorcycle insurers, has officially entered Creditors’ Voluntary Liquidation (CVL). This significant development has attracted considerable attention across the insurance and insolvency sectors. For policyholders, creditors, and industry observers, the move is a sad moment for a firm that had operated in the UK insurance market for nearly 50 years.
In this blog, we’ll explore the key events that led to MCE Insurance’s CVL, the implications for creditors and customers, and what happens next. We’ll also discuss what a CVL involves and why this route may be the most suitable option for struggling businesses in today’s economic climate.
Who was MCE Insurance?
MCE Insurance was a Northamptonshire-based insurance broker, widely known for its focus on motorbike policies. Established in 1975, the company carved a niche for itself by sponsoring major motorcycle events and offering tailored cover for riders. For decades, MCE was a familiar name among biking enthusiasts, offering both direct insurance and acting as a broker for underwriters.
However, in recent years, the company faced growing pressures due to regulatory changes, increased competition, and operational challenges. In 2021, the Financial Conduct Authority (FCA) intervened and revoked the firm’s permissions to carry out regulated activities, including selling and renewing policies. That marked the beginning of the end for the broker, as it could no longer generate revenue through its primary function.
What is a Creditors’ Voluntary Liquidation?
A Creditors’ Voluntary Liquidation (CVL) is a formal insolvency process initiated by the directors of a company when they realise the business is insolvent and is unable to pay its debts. Unlike a compulsory liquidation, which is forced upon a company by creditors via court order, a CVL is a director-led process, often seen as a more controlled and cooperative approach to closing a company while ensuring that creditor interests are managed fairly.
In the case of MCE Insurance CVL, the directors voluntarily decided to wind up the company due to sustained financial difficulties and an inability to recover after regulatory action.
Timeline of events leading to the CVL
The downfall of MCE Insurance didn’t happen overnight. The timeline includes several key events:
- 2021: The FCA intervened, leading to the revocation of permissions for MCE to carry out regulated insurance activities.
- 2022: MCE Insurance ceased writing new business and focused on handling existing customer claims and policies.
- 2023: Administrative and operational restructuring efforts failed to restore financial viability.
- Mid-2025: The company formally entered MCE Insurance CVL, with an appointed Insolvency Practitioner now managing the wind-up process.
These events illustrate the harsh realities of the regulated insurance landscape and the importance of strict compliance with financial and operational standards. They also highlight how quickly a business can unravel when regulatory action limits its ability to operate at the core of its business model.
What happens to creditors and policyholders?
For creditors, the CVL means that the appointed Insolvency Practitioner will take control of the company’s affairs, assets, and liabilities. The practitioner will seek to realise any remaining company assets and distribute proceeds to creditors based on a statutory hierarchy.
Unsecured creditors, including suppliers and service providers, may receive only a portion of what they’re owed – or, in some cases, nothing at all. Secured creditors, typically banks or lenders with charges over company assets, are likely to be prioritised.
Policyholders, meanwhile, had already experienced disruption since the FCA’s action. Those with active policies should have been contacted and transferred to new providers during the transition period. However, some may still have outstanding claims or issues, which will now be handled by the liquidator or, where applicable, the Financial Services Compensation Scheme (FSCS).
Implications for the wider insurance sector
MCE Insurance’s liquidation sends a clear message to the market: compliance, financial resilience, and risk management are non-negotiable in the regulated financial services sector. Smaller brokers operating on thin margins face particular vulnerability, especially in periods of economic volatility and high inflation.
While the case of MCE Insurance CVL is a powerful example, it also highlights the importance of acting promptly when financial distress emerges. Directors and company owners must seek advice at the first sign of trouble. Doing so allows for more options, including restructuring, Company Voluntary Arrangements (CVAs), or, if necessary, a managed CVL.
Lessons for struggling businesses
One of the most common misconceptions among business owners is that liquidation equals failure. In reality, a CVL can be a responsible and strategic move when a company is no longer viable. It protects directors from wrongful trading accusations, enables a structured wind-down of operations, and can sometimes facilitate a new start through a successor business or alternative restructuring arrangement.
Directors must also be aware of their legal duties during times of financial hardship. Trading while insolvent can lead to personal liability. By proactively initiating a CVL, directors demonstrate they’re acting in the best interest of creditors.
The MCE Insurance CVL shows how even long-established businesses can be vulnerable without adequate financial oversight, strong governance, and contingency planning. It’s a case study in the importance of receiving timely, professional insolvency advice.
Get the right insolvency advice
If your business is facing financial difficulties, we strongly advise taking early professional advice. An experienced Insolvency Practitioner can assess the viability of rescue options or, if appropriate, guide you through a Creditors’ Voluntary Liquidation in a compliant and cost-effective manner.
It’s essential not to wait until it’s too late. Whether you’re a director concerned about cash flow, a business owner struggling to meet HMRC obligations, or simply unsure about your next steps, the proper support can make all the difference.
Speak to our insolvency experts today
Our expert team can advise on the best insolvency solution for your individual needs. Our qualified, knowledgeable Insolvency Practitioners, authorised by the Institute of Chartered Accountants in England and Wales, offer free, impartial advice to ensure you liquidate your business in the best way. Contact us using the form below, via our live chat, email to mail@Simpleliquidation.co.uk or by calling 0800 246 5895.
