Ensurance’s Executive Chairman and its largest shareholder Tony Leibowitz has lent the loss-making company $2.5 million to support its “next phase of growth”.

The underwriting agency says the loan, combined with cash reserves and other initiatives, will provide sufficient funding for ongoing operations and growth for at least the next year, based on current plans.

“Ensurance is a high-growth company with aggressive expansion plans over the coming years,” Mr Leibowitz said.

“This loan will support the business in executing those expansion plans, especially in the UK.”

Ensurance recorded an $8.7 million loss last financial year, and was required to outline its funding plans after a March-quarter cashflow report prompted an Australian Securities Exchange query.

The sharemarket said “it was possible to conclude” that if the company continued to spend at the rate indicated, it may not have sufficient cash to continue funding its operations.

Ensurance said in response that it was in “advanced discussions” with a number of high-net-worth and strategic investors and had secured continued unconditional financial support from a major shareholder.

The loan from Mr Leibowitz is unsecured, has an interest rate of 16%, a term of two years and is repayable at the company’s discretion, the company says.

“I continue to believe in the huge potential of the business and remain committed to its long-term success and the creation of value for our shareholders,” Mr Leibowitz said.

Ensurance last week launched a latent defects policy, with Lloyd’s capacity, to protect against property damage from structural defects discovered up to 10 years after a building is constructed.

Mr Leibowitz says this will meet a large and growing need to protect property owners, and expands the group’s offering through another niche product for the construction and engineering insurance market.