merrion street

The Minister for Finance, Mr. Michael Noonan, T.D. today (13 September 2011) published the Insurance (Amendment) Bill 2011.

This Bill seeks to amend the Insurance Act 1964, which is the principal act underpinning the operation and role of the Insurance Compensation Fund (ICF).

The Bill proposes to:

(a) extend the scope of the Insurance Compensation Fund to cover all insured risk in the State

(b) To apply a levy (of up to 2%) to all non-life insurance polices rather then just limiting it to policies of Irish authorised firms

(c) To remove the policyholder protection provision for international business in a liquidation situation; and

(d) that, from the date the legislation is enacted, funding for administration purposes for the ICF will only be available to companies who conduct a significant percentage of their overall business in the Irish market (significant to be defined as 70% averaged over the previous 3 years)

These changes are required to ensure that the ICF levy legislation is consistent with EU law, furthermore they ensure that the ICF can only be applied to risks located in Ireland (including those who are authorised by a Central Bank in another Member State) and only those who pay the levy will receive the benefits from the Fund.

The Bill will be initiated in the Seanad this Thursday, 15 September 2011 and will complete its passage through the Dáil no later than 29 September 2011.