Top insurance companies barred from covering state and semi-states
THREE foreign-owned insurance firms have been restricted from providing cover for Irish state companies.
This is because they were downgraded after Ireland had been demoted by credit rating agencies.
The Irish Insurance Federation has been lobbying Finance Minister Michael Noonan on the issue.
Allianz, Aviva and RSA Insurance represent up to 40pc of the non-life insurance market and although they are foreign owned, they have been capitalised in Ireland and have most of their customers here.
As the country has been downgraded, the companies have also been demoted, even though they meet solvency requirements of the Central Bank.
According to RTE News, the Irish Insurance Federation has written to the Minister claiming the development has resulted in serious consequences for their business.
One of the effects is that the insurers no longer meet the requirements needed to offer cover to state and semi-state companies.
Minister Noonan has replied saying he was unaware of a specific code of practice or legislation which set minimum criteria.
However, it is understood that state bodies do have their own minimum ratings which they set individually.