Consumer Insurance Contracts Bill 2017- A Step in the Right Direction

The introduction of the insurance contract bill will come as welcome relief and respite for Irish policyholders who in the past have seen their insurance contracts subjected to ever-increasing terms, conditions and warranties.

Insurance Contracts BillThe new legislation follows recent comments by Financial Services Ombudsman Ger Deering, who accused the insurance industry of voiding policies in a way he said was “unreasonable and disproportionate”.
Currently, as it stands, insurance companies can rely solely on their own “in-house” insurance policy to dictate the terms and conditions that can be relied upon to determine policy cover and claims conditions.

At the present moment, even the slightest minor indiscretion, error, innocent misrepresentation or innocent omission, can allow insurers to void and throw out their policyholders claims.
The bill aims to counteract this, and the legislation specifies how insurers are to administer the insurance contract to be fairer, more practicable and specify how insurers should treat their customers. The bill also aims to prevent insurers from declining claims based on remote or unrelated warranties, conditions, innocent omissions, innocent misrepresentations and errors made by the lay Policyholder.

Under the bill, the onus will be on insurers to ask the relevant questions when a consumer is taking out a policy. This is the opposite of the current situation, where the Policyholder is expected to anticipate exactly what has to be disclosed.

The bill also stipulates that the interpretation of any ambiguous policy wordings in the insurance policy wordings must favour the Policyholder. One would assume that as the policy, which is a very complicated legal and technical document, is written by the more powerful party, therefore, the Policyholder should not be expected to have and hold the same knowledge as the more dominant party, the insurance company.

Minister with responsibility for insurance reform Michael D’Arcy, who is piloting the bill through the Oireachtas, said it was a radical piece of legislation that should have happened years ago.
“It shifts the power to individuals rather than strong corporate entities,” he said.
Mr D’Arcy said when the bill is passed, insurers will no longer be able to “rely on the small print to avoid paying a claim”.
He said contracts were unfair at the moment, forcing thousands to complain to the ombudsman.

Under the bill, the onus will be on insurers to ask the relevant questions when a consumer is taking out a policy. This is the opposite of the current situation, where the Policyholder is expected to anticipate exactly what has to be disclosed.

The second main area of change relates to retentions and their application following the completion of a successful claim. Currently, insurers retain a portion of the payment, typically between 25-60% until the works are completed, or have reached a particular milestone, a practice which is known as “retention”. In the last number of years, insurance companies have progressively increased the percentage that is retained following a loss. With ever-increasing policy excesses, policyholders are very often in a much worse position than they were before the loss.
Under the new bill insurance companies will be limited to holding a maximum % based on the size of the claim, in 2 bands. The bill stipulates that the maximum retention that insurers can retain is capped at 5% on settlements less than €40000, and 10% on settlements over €40000

In practice as an experienced property claims expert, I don’t see too many changes. I already find that most of the leading Insurance companies are fair, reasonable and already take account of their Policyholder’s interests.

I do, however, welcome the reduction of the percentage of retained monies. It is generally accepted within the industry that retaining funds, while expecting a policyholder and or their builder to fund a construction project, following a loss isn’t fair and reasonable.
Given that the insurance policy is to put the Policyholder into the same position they enjoyed immediately before the loss, the application of retention is in direct contradiction to this premis.

I am aware of several large projects that have never been finished to a pre-loss condition because the Policyholder was unable to fund the balance that was retained by an insurance company.
If the Policyholder does not have access to credit to fund the balance of the project retained, they will not get the project completed and will have to live with a property that’s inferior to the pre-loss condition.

In summary, as a policyholder advocate and property claims expert, I welcome the proposed changes. In particular, I look forward to the introduction of further legislation protecting policyholders interest. The cap on retentions will make for a fairer and more equitable claim settlement process while eliminating the financial burden on policyholders following a loss.

https://data.oireachtas.ie/ie/oireachtas/bill/2017/3/eng/ver_b/b3b17d.pdf

Contact Details

Insurance Claim Solutions
Golf Rd, Rush, Co. Dublin

Mobile: 086 357 1713
Phone : 01 870 9210

We are registered as Public Loss Assessors and fully regulated by the Central Bank of Ireland

Google Reviews

Custome Reviews
Karl Spratt
Karl Spratt
16:47 28 Nov 22
Recently had a bad leak in our upstairs bathroom, I was recommended Trevor from Insurance Claims Solutions. The best thing I ever did, Trevor and the Team at Insurance Claim Solutions made everything hassle free, they dealt with all aspects of our claim. Trevor is an exceptional insurance agent who is prompt, efficient, knowledgeable and friendly. Trevor guided my through the process ensuring the outcome for me was his priority. 100% recommend Trevor from Insurance Claims Solutions, if I could give him more than 5 stars I would!
Susie Webster
Susie Webster
12:35 03 Nov 22
Recently had a bad leak in my bungalow, was recommended Trevor from Insurance Claims Solutions. The best thing I ever did, Trevor is an exceptional insurance agent who is prompt, efficient, knowledgeable and friendly. Trevor guided my through the process ensuring the outcome for me was his priority. 100% recommend Trevor from Insurance Claims Solutions, if I could give him more than 5 stars I would!
N roy
N roy
19:20 23 Oct 22
Trevor was recommended to us only 4 weeks ago. We had a leak in kitchen which we thought would need just a new floor. Trevor came in and from that moment onwards we were in safe hands, far more damage than we ever thought thanks to Trevor, he did all the work with our insurance company, no hassles at all. If you have something happen at home and are thinking of using your insurance look no further than Trevor. His knowledge his second to none, best decision we have made in years. 5 stars isn't enough.ThanksNigel and Mags
Graham Nugent
Graham Nugent
09:24 20 Oct 22
I am delighted to recommend Insurance Claim Solutions to anyone facing a need to submit a home insurance claim. We had a significant escape of water from our attic tank while we were away, and came home to quite a smelly mess and water damage. We contacted Insurance Claim Solutions and really appreciated Trevor Kelly's attention to detail, and his professionalism. Trevor is a really good communicator and he is friendly, he took away all of the hassle and bureacracy for us; and as an industry expert he was thorough in preparing our claim and negotiating on our behalf. We handed everything over to Trevor and had no regrets; now that the claim has been settled, we could not be more satisfied. Thank you Trevor.
Eoin Donohoe
Eoin Donohoe
09:21 30 Sep 22
I recently worked with Trevor on a housing claim that required experienced support from a top quality professional. Trevor certainly is a high quality professional who provided great support. Trevor is a great communicator and was extremely good at keeping me up to date on how the process was progressing. He kept me reassured that the issue had his focus and commitment at all times. I would highly recommend Trevor.
See All Reviews
js_loader