Minister rejects request from TD to intervene over cost of insurance cover for sports organisations

‘Pricing of insurance products a commercial matter’

Sligo News File

Minister for Finance Paschal Donohoe

Finance Minister Paschal Donohoe has rejected a request from a Sligo TD asking him to contact the insurance industry over current insurance charges for sports organizations

Marc Mac Sharry, in a written submission, said sports bodies were being “hit by large premiums.” He asked that the Minister seek to have insurance premiums based on what he called “true risks” that is, he said, “the reduced risk associated with the drop in usage and football due to Covid restrictions.”

He went on to ask “if the insurance sector will be further requested to be lenient in relation to payments for sports clubs, given the Minister’s request for banks and lending institutions to show forbearance to business and clients with loan and mortgage repayments.”

However, Donohoe told him that neither he nor the Central Bank could direct the pricing of insurance products, as it was a “commercial matter.”

In addition, stated Donohoe, “we cannot compel any insurer operating in the Irish market to provide cover to specific individuals or groups, nor can we require them to obtain prior approval of the pricing or terms and conditions of insurance products. This position, he added “is reinforced by the EU Single Market framework for insurance (the Solvency II Directive) which expressly prohibits Member States from doing so.”

Donohoe went on to say, however, that insurance reform was a priority for the Government, “with a view to improving the insurance environment, including for sports and community based groups. In this regard, the recently-launched Action Plan for Insurance Reform contains a range of deliverables, including:

– increasing market transparency through the National Claims Information Database (NCID), including for employer and public liability insurance;

– reviewing the duty of care legislation;

– providing for the Judicial Council’s accelerated adoption by 31 July 2021 of new personal injuries guidelines to replace the Book of Quantum;

– consideration by the Department of Justice of the Law Reform Commission’s recent Report on Capping Damages in Personal Injuries Actions;

– looking at how to further enhance the role of the Personal Injuries Assessment Board; and,

– making proposals on increasing competition in the Irish insurance market.

“Recognising that many sports and community-based groups need to see the impact of these reforms as soon as possible, the Action Plan contains 66 actions, 95% of which are due to be completed by the end of 2021. The focus is clearly on completing these actions in the short to medium term. As such, I am hopeful that key reforms around personal injury awards may start to have an impact during this year on the pricing and availability of insurance.”

“Regarding the Deputy’s query relating to forbearance with respect to sports clubs, I would note that Insurance Ireland last month (27 January) announced a continuance of such measures on behalf of a number of its members. Both Minister of State Fleming and I will continue to raise the issue through engagement with insurers in the coming weeks.

“In conclusion, seeking to secure a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland remains a key policy priority for this Government. In this regard, it is my intention, along with Minister of State Fleming, to work with our Government colleagues to ensure that implementation of the Action Plan can have a positive impact on the affordability and availability of insurance for individuals, businesses, community and voluntary groups across Ireland.”