Rose Conway-Walsh demands insurers pay business interruption claims
Deputy Rose Conway-Walsh challenged the minister over insurers refusing to honour business interruption claims and withholding premium refunds for businesses ordered to temporarily close. She accused the insurance industry of acting immorally and asked whether regulators or the government would use legal or sanctioning powers to resolve the dispute.
Allegations against insurers
The Deputy described insurers as flatly refusing to honour business interruption clauses even when policy wording explicitly covers closures ordered by national or local government. She said some firms are refusing to refund any part of premiums while businesses remain closed and warned this conduct is harming small towns and rural employment.
Good faith and business interruption cover
She emphasised that good faith is a cornerstone of insurance and that business interruption cover is taken in that spirit to protect businesses in the event of a loss. The Deputy relayed that many business owners view the insurers' conduct as immoral and equate it to theft, citing a businesswoman with 40 years in trade who fears she may not continue.
Regulatory and legal options raised
The Deputy asked whether the minister would seek a court judgment similar to actions by the Financial Conduct Authority in Britain and whether any sanctioning instruments are available to compel ethical behaviour from insurers. She noted that Sinn Féin has written to the Central Bank and urged reconsideration of multi-party litigation reform to allow groups of similar cases to be dealt with collectively.
Ministerial and Central Bank response
In reply, the minister said the Central Bank has engaged directly with the insurance industry, writing to CEOs of major insurers and urging customer-based solutions. The minister and the Central Bank have stressed that unclear policy terms should be interpreted in the customer's favour and that insurers should propose fair resolutions.
Banks and payment breaks
The Deputy also sought clarification on bank practices, asking whether the minister had raised concerns about banks increasing outstanding balances by thousands of euros due to interest continuing to accrue after payment breaks. She asked whether the minister had advised banks that such increases are unacceptable.
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Córle, Minister, businesses are now making crucial decisions as to whether they will reopen or not. This has been done every day of the week and we still see insurance companies fighting tooth and nail to cripple the same small businesses. These are the businesses that have come through the recession, have battled through everything. I spoke to one businesswoman yesterday who has 40 years in business and she doesn't know whether she will be able to continue on in business, employing a lot of people, particularly in rural areas and in small towns. And the insurance companies continue to play with the words, but they're also playing with people's livelihoods and the livelihoods of these communities. And they're doing this on two fronts, as you know. Firstly, they're flatly refusing to honour claims made by the business interruption clauses, even when the policy document is very explicit and states that the business is covered in instances where a national government or local government instruct temporary closure. Now, one of the pillars of insurance, which after all is compulsory, is good faith. So when you take out a business interruption insurance, you do so in good faith and the insurance company will cover you in the event of a loss. So there are many business owners who consider the immoral behaviour of the insurance industry as theft. Secondly, others are refusing to refund even part of the premiums while the business is closed. So I suppose one of the questions around that is, have you sought uniformity across the insurance industry in their approach to businesses that have been closed? I think you talked about it a bit earlier on, but that is not happening in the ground. And I'm speaking with business owners every day who tell me their insurance companies are showing complete flexibility with them. The other question I have, Minister, is in Britain, the Financial Conduct Authority is seeking a court judgment on behalf of businesses to clarify the issue. And as you are the minister in charge here, are you considering doing the same thing? And maybe you could just tell us if there are any instruments of sanction that are available to you to take control of the situation in relation to the insurance industry and to ensure that they act in an ethical manner. Now, Sinn Féin has written to the Central Bank to ask if they will take similar actions here. I assume that you've had similar conversations with Central Bank, but I would also remind you, Minister, that it's precisely for scenarios such as this that Sinn Féin tried in vain to progress the multi-party actions bill in 2017 that would have been a game changer, enabling groups of cases that share characteristics efficiently to allow them to be dealt with collectively. Currently, the only real option is for test cases to proceed and related cases to follow subsequently on that basis. So, justice denied is justice delayed for many of the small businesses who don't have the financial capacity to take on the might of the insurance industry. So, would you agree that blocking that legislation was wrong and that that should be revisited? I just want to ask you, in relation to the banks, thank you for that information, but could you clarify that you had a conversation with the banks in increasing the way they are increasing the outstanding balance by thousands of euros? Because under the current payment breaks, that interests will still continue to accrue thereafter. So, have you advised the banks that this is unacceptable? In relation to Deputy Conway Walsh and the points that the Deputy made, the Central Bank have now engaged directly with the insurance industry on many of the matters that you're referring to. They've written to the CEOs of all of the major insurers and stressed to them that customer-based solutions have to be put forward to the resolution of these issues. And if the insurance policy isn't clear, and if there's a doubt regarding the meaning of particular terms, and the interpretation that's most favourable to the customer is the one that should prevail. I have said this myself to the insurance sector, I've said it publicly, and the Central Bank is engaging on this matter. No. No. No. You
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