‘Major Insurers in Ireland Defying Euro Regulator’ – Chris MacManus MEP

Sinn Féin MEP Chris MacManus has revealed that the EU insurance regulator EIOPA (the European Insurance and Occupational Pensions Authority) has confirmed to him that insurers across Europe are continuing to pay dividends despite Covid19 and in the face of a strong recommendation from the regulator. Amongst those named as ignoring the regulator received by MEP MacManus are AXA and Allianz, two major insurers in the Irish market. 

MacManus said:

“In correspondence received by my office EIOPA have confirmed to me that of 73 insurance groups, 28 have paid out dividends on the first half of 2020. Only one of the biggest 5 insurancegroups in Europe have actually suspended dividends, the other four have paid out in some form or another,

Only 3 of the 73 have actually announced a cancellation due to Covid in line with the EIOPA recommendation.

These are shocking figures. They are sickening quite frankly given the struggle facing workers and small businesses, some in the face of insurers refusing to pay out such as on interruption of business polices or motor insurers still charging huge fees despite of the huge drop in claims as the roads were empty for weeks and months of the year.

When every driver or business in Europe pays their insurance this year there is a huge chance that they will be paying part of it simply to pay a dividend the regulators say shouldn’t be paid out at all. Unfortunately, consumers are used to this arrogance from the insurance sector.

In April EIOPA stated that insurers should suspend “all discretionary dividend distributions and share buy backs aimed at remunerating shareholders. This suspension should be reviewed as the financial and economic impact of the COVID-19 starts to become clearer.”

We now know due to my correspondence that most insurers are simply ignoring this recommendation.  It is not only a moral issue. The regulator’s approach is based on making sure insurers have enough reserves and not engaging in a race for dividends that endangers the entire system.

The relevant National Competent Authorities (NCAs) or EIOPA must be empowered to make these recommendations binding in the interest of consumer protection. I will be writing to the Central Bank of Ireland to ask them to look at this issue and I will be raising this issue in the European Parliament.” ENDS