Central Bank must use powers against insurers refusing to pay out for Covid-19 business interruption – Pearse Doherty TD
Sinn Féin Finance spokesperson Pearse Doherty TD has called on the Central Bank to use its supervisory and enforcement powers against insurers refusing to pay out to thousands of businesses covered for business interruption in their policies who were forced to close due to Covid-19.
Speaking today, Teachta Doherty said: “FBD announced this week that it had set aside €22 million as a precautionary reserve in the event that it loses an upcoming test case in the High Court against a number of small business that have been refused claims under FBD policies for business interruption.
“It is clear that a number of insurers provided business interruption cover to small businesses who were then forced to close as a result of the COVID-19 outbreak.
“Despite this, they are refusing to pay out for insurance cover that these businesses paid extortionate premiums for.
“On March 27th, the Central Bank wrote to the CEOs of all insurers to clarify that the Government advice for businesses to close in the context of Covid-19 should be treated as imposed closure as per the wording of a number of insurance policies sold to business customers.
“It is clear that a number of insurers have decided to ignore this advice, leaving small businesses with no choice but to turn to a prolonged and expensive court process.
“In Britain, the Financial Conduct Authority is seeking a court declaration against eight insurers concerning 19 different policy wordings, in an effort to provide swift clarity to small businesses.
“The Central Bank cannot allow insurance companies to shirk their responsibility under insurance policies that have been signed and paid for by small businesses.
“I have written to the Central Bank requesting that they use all supervisory and enforcement powers at their disposal to ensure the compliance of the insurance industry with their own insurance policies and financial services legislation.”