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Covid-19 Pandemic Supports

Dáil Éireann Debate, Thursday - 28 January 2021

Thursday, 28 January 2021

Questions (49)

Jackie Cahill

Question:

49. Deputy Jackie Cahill asked the Minister for Finance his plans to support the hospitality sector in getting the insurance sector to pay compensation for business interruption as a result of Covid-19; and if he will make a statement on the matter. [4786/21]

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Written answers

At the outset it is important to note that working to protect customers during and after the COVID-19 crisis is a priority issue given its inclusion in the Programme for Government. As such, business disruption insurance is specifically included within the Action Plan for Insurance Reform, launched last month. I am in full understanding of the concerns expressed about how the insurance industry is responding to the needs of its business policyholders in these difficult times, including honouring business interruption claims. Whether a company is able to successfully claim on its business interruption policy due to a COVID-19 enforced closure will depend on the specific policy. This is ultimately a matter of contract law between the business and its insurer. While this is an issue that Minister of State Fleming and I continue to follow closely, it should be noted that neither we, nor the Central Bank of Ireland (CBI), can direct or require that insurers cover claims, including those resulting from infectious diseases such as COVID-19, nor can we adjudicate on the validity of such claims.

The above said, we both have had a number of engagements with the insurance industry on this issue, and have made it very clear that insurers should not attempt to reject claims on the basis of interpreting policies to their own advantage. They should engage with those impacted businesses honestly, fairly and professionally to honour those elements of the policies covered, in line with the CBI’s Consumer Protection Code. Minister of State Fleming reiterated this expectation to the main insurers in the Irish market during his engagements with them late last year.

Separately, the CBI’s COVID-19 Business Interruption Supervisory Framework sets out its expectations of insurance firms in handling related insurance claims. The objective of the Framework is to seek early identification and resolution of issues which have the potential to cause customer harm and bring clarity to affected businesses as quickly as possible. Significantly, in my view, where cover and related issues are disputed, the CBI expects firms to pay the reasonable costs of customer plaintiffs in agreed test case litigation. On that point, I would note that a number of related test cases are before the High Court, with judgments due to be handed down next week. Accordingly, it would be inappropriate for me, or the Government to provide comment on these at this stage.

In conclusion, the Deputy should be assured that Minister of State Fleming and I will continue to monitor the business interruption issue and will engage appropriately with both insurers and the Central Bank of Ireland on the matter.

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