Insurance industry must contribute to national effort rather than avoid indemnity for closed businesses – Pearse Doherty TD
Sinn Féin Finance spokesperson Pearse Doherty TD has written to the Minister for Finance requesting he engages with the insurance market in light of a number of insurers seeking to avoid indemnity for business interruption on spurious grounds while the survival of jobs and small businesses are at stake.
Deputy Doherty has also written to the Central Bank requesting what measures can be taken to ensure that the insurance industry does not shirk its responsibilities during this economic crisis.
Speaking today, Deputy Doherty said:
“The COVID-19 outbreak, and our public health response, has led to the essential shut-down of whole sectors of our economy, including hospitality. This is unprecedented.
“As a result countless restaurants, pubs and other businesses in the hospitality sector have closed down, and face severe cash flow problems in the weeks and months ahead. Their survival, and the survival of thousands of jobs, is on the line.
“It has become clear that a number of insurers are seeking to avoid indemnity for business interruption, despite it being written into the insurance contracts of many of their customers.
“For some businesses, this is despite infectious or contagious diseases being explicitly recognised in written contracts as a legitimate cause of business interruption or interference.
“We have learnt that a number of insurers are trying to avoid this indemnity on the grounds that closures took place as a measure of prevention, or simply to stall on their obligations in the hope of an expected bailout from the State.
“While it is clear that this is an unprecedented situation for underwriters, this approach is not sustainable or acceptable. The insurance sector has returned to profitability, and it is time that they play their part in this national emergency.
“They must reach agreement with their customers and find resolution to this situation before it results in litigation.
“My Consumer Insurance Contracts Bill would have offered greater protections to these businesses than currently exist. Indeed, it would have resulted in insurance contracts being read in favour of the consumer or business if a dispute such as this was ever to arise.
“Unfortunately, despite it being signed into law in December of last year, this Government have refused to commence it. That is unfortunate and will deny these businesses much needed protections.
“I have written to the Minister and the Central Bank to engage with the insurance sector and ensure that they play their part in this emergency, when so many jobs are on the line. Nothing less will do.”