Central Bank must tell us where each insurer is regulated
Published 23/07/2016 | 02:30
Motorists are likely to lose out again after a new blow was suffered by our dysfunctional insurance market following the collapse of Enterprise Insurance. Enterprise is the second foreign-regulated insurer to crumple.
The insurance sector here is turning into one big car crash. Premiums across the board rose by almost 40pc last year, and are now up 70pc in the last three years. Insurers have blamed the previous collapse of Setanta for their premium-raising frenzy, along with high levels of claims, tough new regulatory rules and their failure to put sufficient reserves aside to meet claims.
The insolvency of Enterprise Insurance is not directly related to problems in the Irish market as only 7pc of business was in this jurisdiction.
But there are fears drivers here will have to cover the cost of claims for drivers who have policies in Ireland.
The €92m cost of the Setanta crash has to be picked up by insurers here, even though it was regulated in Malta. Both Setanta and Enterprise were operating here under EU "passporting" rules which allow insurers to be regulated in one country but sell insurance in another.
Neither were prudently regulated by the Central Bank.
There is now an onus on the Central Bank to tell consumers which insurers it regulates and which it does not, and where exactly each firm is prudently regulated.