The Minister of State responsible for insurance Seán Fleming (pictured) has published a bill aimed at improving transparency in a number of areas of the insurance market.
The minister said that the bill would “shine a light” on insurers who deduct State supports from claim settlements.
During the pandemic, a number of insurers deducted COVID-related supports paid to businesses from final claims settlements linked to business-interruption insurance.
The Insurance (Miscellaneous Provisions) Bill would require the Central Bank to collect data through the National Claims Information Database (NCID) on any deductions from claim settlements linked to such supports.
Insurers would also have to disclose to consumers – under the Consumer Insurance Contracts Act 2019 – any deductions of public money from insurance settlements.
Minister Fleming said that the measures would provide the Government with the evidence with which to consider any future policy intervention to protect taxpayers’ money.
The new bill will also require to Central Bank to update the Minister for Finance on the effectiveness of its ban on ‘price-walking’ – a practice that results in customers who stay with the same insurance provider for a number of years paying more for their premiums.
The ban takes effect from July, and the report would have to be delivered within 18 months of the new bill’s enactment.
The bill also includes amendments to the European Union (Insurance and Reinsurance) Regulations 2015, in order to address issues identified by the Central Bank with the Temporary Run-off Regime (TRR) for UK and Gibraltar-based insurers.
The TRR was set up due to the UK’s departure from the EU, after which these insurers lost the ability to write new business in EU member states.
These amendments will provide for technical changes, in order to ensure that certain insurance firms who provide reinsurance, and firms in liquidation, can use the TRR to run off their existing Irish insurance contracts.