(Sharecast News) - Insurance premium financing specialist Orchard Funding Group updated the market on the guaranteed asset protection (GAP) insurance market on Friday, after a review by the Financial Conduct Authority (FCA).
The AIM-traded firm said following the review, several insurers had decided to withdraw their products from the GAP insurance market.
It said GAP insurance is typically offered as an add-on to motor insurance policies, covering the disparity between a vehicle's purchase price and its current market value.
As of 31 December, more than 20% of the group's assets were tied to financing GAP insurance products.
The withdrawal of the insurance offerings was expected to have a material adverse impact on Orchard's financial results for the current financial year.
It said it was actively evaluating the repercussions of the product withdrawals, and it was working on redeploying its assets accordingly.
At 1623 GMT, shares in Orchard Funding Group were down 30.3% at 23p.
Reporting by Josh White for Sharecast.com.
Orchard Funding (ORCH)