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Press release

Minister of State Fleming welcomes the commencement of the Insurance (Miscellaneous Provisions) Act 2022

  • majority of the Act to take effect immediately
  • Central Bank to report on price walking in motor and home insurance
  • from January 2023, insurers must notify consumers of deductions made from claim settlements

The Minister of State with special responsibility for Financial Services, Credit Unions and Insurance, Seán Fleming, has today welcomed the commencement of the majority of provisions of the Insurance (Miscellaneous Provisions) Act 2022, with immediate effect:

“Today’s commencement of the key provisions within the Insurance (Miscellaneous Provisions) Act 2022 represents an important consumer protection enhancement, and complements Government’s ambitious insurance reform agenda.

"In particular, the Central Bank of Ireland is now required to provide a timely assessment of its price walking ban, a new pro-consumer measure, the first of its kind in the EU. Price walking, effectively a ‘loyalty penalty’, is where customers are charged higher premiums relative to the expected costs the longer they remain with an insurance provider.

"Central Bank research shows customers who have stayed with their insurance provider for nine years or more, are paying, on average, 14 per cent more for private car insurance and 32 per cent more on home insurance. There are currently 2.2 million private motor and 1.3 million home insurance policy holders around the country.

"Other elements within the Act provide a legislative basis for the collection of data by the Central Bank on State supports deducted from claim settlements in its National Claims Information Database, bringing welcome clarity to this issue. The Act also protects consumer interests by enabling some UK firms provide service continuity to existing Irish policyholders."

Notes

The Insurance (Miscellaneous Provisions) Act 2022 (Commencement) Order 2022 provides for the commencement of the Insurance (Miscellaneous Provisions) Act 2022 as follows:

From today, 8 July 2022, Sections 1-6, and Sections 9-11, of the Act take effect. These include:

  • Section 3 amends the Central Bank (National Claims Information Database) Act 2018 to provide a definition of ‘public moneys’ for the purposes of the amendment to the Act in Section 4
  • Section 4 amends the Central Bank (National Claims Information Database) Act 2018 to enable the Central Bank of Ireland to collect and publish data, through the National Claims Information Database (NCID), on any deductions from insurance claim settlements by insurance undertakings that relate to public moneys (that is, ‘State supports’)
  • Section 5 provides a number of relevant definitions for the purposes of Section 6
  • Section 6 provides for the Central Bank of Ireland to prepare and submit a report to the Minister for Finance within 6 months of the first anniversary of the commencement of this Section, that is, 18 months, setting out the measures (if any) it has taken in relation to the practice of price walking and automatic renewals of non-life insurance products, and the Bank’s opinion on insurers’ oversight of pricing practices. In addition, the report will set out the Bank’s views on whether further measures are required in relation to any of these matters. A copy of the report will be laid before both Houses of the Oireachtas as soon as practicable upon receipt
  • Section 9 amends Section 18(4) of the Consumer Insurance Contracts Act 2019 to clarify that the provision under this Section does not preclude insurers from excluding, from the basic risks insured under the contract, property loss or damage arising from certain forms of criminal conduct
  • Section 10 provides for a consequential amendment to the Central Bank Act 1942 in relation to the Central Bank’s powers to enforce certain sections of the Consumer Insurance Contracts Act 2019
  • in order to protect consumer interests, Section 11 amends the European Union (Insurance and Reinsurance) Regulations 2015. These amendments will provide for some technical changes in order to address certain issues in relation to the scope of the Insurance Temporary Run-off Regime (TRR) for UK- and Gibraltar-authorised insurers
  • on 1 October 2022, Section 7, and Section 8 as it relates to Section 16A in the Consumer Insurance Contracts Act 2019, will come into operation. On this date, the current Section 16(10) of the Consumer Insurance Contracts Act 2019 will be replaced by a new Section 16A. This will provide for a technical amendment to the Act, in order to ensure clarity regarding the duties of insurers and consumers to disclose certain information
  • on 1 January 2023, Section 8 as it relates to the new Section 16B in the Consumer Insurance Contracts Act 2019, will come into operation. This means that from January next year, insurers will be required to inform consumers of deductions made from claim settlements, including those that relate to State supports (with the exception of those made under the Recovery of Benefits and Assistance Scheme operated by the Department of Social Protection)

The provisions of each section of the Act are set out in the Explanatory Memorandum, which is available on the Oireachtas website.

The full text of the Insurance (Miscellaneous Provisions) Act 2022 will shortly be available on the Irish Statute Book website.

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