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Central Bank must enforce Consumer Protection Code against insurers refusing indemnity for business closure - Pearse Doherty

10 April, 2020 - by Pearse Doherty TD

Sinn Féin spokesperson on Finance Pearse Doherty TD has called on the Central Bank to audit the processing of claims by the insurance industry for businesses that have closed as a result of the Covid-19 pandemic.

Despite guidelines issued by the Central Bank on the 27th March, insurers are still refusing to pay claims or offer breaks and rebates to businesses that have closed and are struggling to survive.

He said:

"At a time of national emergency, when thousands of businesses are suffering and tens of thousands of jobs are being lost, insurers are still refusing to pay out valid claims or offer payment breaks to closed business. 

"A number of insurers, including FBD, have refused indemnity by claiming that businesses closed voluntarily. This is not only deeply cynical, but implies that the only way businesses could access cover is by remaining open until a customer or worker contracts Covid-19. Thankfully, businesses that closed have a greater regard for public health than insurers do for their customers. 

"On the 27th March, the Central Bank called on insurers to bring forward consumer-focused solutions in the form of payment breaks, rebates and claims. It is clear from contacting hundreds of businesses throughout the State that these solutions are not being offered to customers.

"A recent survey by PALI found that less than 10% of play centres have been offered a payment break or rebate from their insurers despite closing down.

"The Central Bank also made clear that where policies were covered for business closure as a result of government direction, insurers must accept claims and pay them promptly. Again, it is clear that this is not happening.

"The insurance companies are not meeting the expectations set out by the Central Bank, and they need to now enforce these expectations.

"I have written to the Central Bank requesting an audit be carried out of claims that have been made by businesses as a result of business interruption and the processing of these claims by the insurance industry. 

"This examination would ensure that insurers who fail to abide by the Consumer Protection Code are liable for sanction, while also encouraging insurers to put the interests of their customers first."

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