Fianna Fáil Spokesperson on Finance Michael McGrath will tomorrow move in the Dáil his party’s motion which aims to deal with over 1,600 outstanding claims associated with the collapse of Maltese-regulated Setanta Insurance almost three years ago.
The Fianna Fáil motion also calls on the Central Bank to conduct an awareness campaign so that consumers are informed better of who regulates the motor insurance firm their policy is with. The motion will bring clarity as to who is responsible for the costs that arise if another insurance company collapses in Ireland.
Speaking in advance of the Dáil debate, Deputy McGrath said: “Nearly three years have passed since the collapse of Setanta Insurance and yet, over 1,600 claims from policyholders, worth up to €95 million, are still not dealt with. Some motorists caught up in the collapse of Setanta have had their lives put on hold.
“Some have incurred serious injury, have been unable to work since and are still left hanging in limbo. Pending the Supreme Court judgment, we believe the Insurance Compensation Fund should now provide the necessary resources to the Setanta Liquidator to deal with the outstanding claims.
“The failure to secure agreement on the Motor Insurance Compensation Framework published last July means that all motorists remain exposed in the event of a future collapse of an insurance firm in Ireland. Under current arrangements, only 65% of outstanding claims up to a value of €825,000 will be met.
“This is an unacceptable situation facing motorists here and the government needs to move swiftly to implement an agreed new policy on who pays when an insolvent insurance firm is put into liquidation.
“There is very little to no awareness among consumers that of the regulatory environment in which insurance firms operate in Europe.
“Fianna Fáil has identified 23 different insurance companies that are currently registered with the Motor Insurers’ Bureau of Ireland as “Freedom of Services” firms, of which 10 are based in Gibraltar. These companies are similar to Setanta and Enterprise in that they are regulated in other European jurisdictions but are allowed to sell to Irish motor insurance customers. This is in accordance with EU law but consumers need to be made aware of the difference between firms operating under different regulatory statuses.
“The outstanding claims caught up in the Setanta and Enterprise Insurance collapses need to be resolved. We need a new compensation framework to be put in place to deal with any future collapses. The Central Bank and the government need to raise any concerns they have about regulation elsewhere in the EU with the relevant authorities.
“Consumers also need to made aware of the different regulatory status of firms selling business into Ireland,” concluded McGrath.