Statement – Central Bank of Ireland

17 February 2021 Press Release

Central Bank of Ireland

The Central Bank is continuing its system wide supervisory examination of business interruption insurance issues, in line with the COVID-19 and Business Interruption Insurance Supervisory Framework.

Under the examination, the Central Bank expects firms to ensure the fair treatment of customers, including:

  • That they honour valid claims and pay them promptly;
  • Where there is doubt about the meaning of a term, the interpretation most favourable to the customer should prevail;
  • Where legal action results in an outcome that has a beneficial impact for similar customers, firms are required to take swift action to ensure those customers benefit from the final outcome; and
  • That they make interim payments to policyholders who make or have made claims pending the final determination of the sums due. The Central Bank is actively monitoring firms’ progress in the resolution of such claims.

Following the judgement from the High Court on business interruption claims, the Central Bank has contacted insurers to reaffirm its expectations in relation to insurers’ fair treatment of customers, setting out our expectation that firms to take a proactive and speedy approach in communicating with affected customers and resolving relevant claims.

Director General, Financial Conduct, Derville Rowland said: “Our system wide examination has already delivered positive outcomes for impacted customers. Following the extensive identification and review of hundreds of different policy types, a number of insurance firms had already accepted and commenced settling claims prior to the recent court decision.

“We have made our expectations abundantly clear and we now expect firms, where they have not already done so, to take a proactive and swift approach in their communications with customers and resolution of valid claims. While there are further decisions before the courts in relation to the quantum of payments, we do not see any reason for any firm to delay matters any further for customers in advance of those hearings.

“Throughout our extensive engagement we have repeated that insurers must adopt a customer-first approach to the resolution of these issues. We will continue our work on behalf of consumers and we will examine all options within the full suite of our powers and intervene where appropriate. We have already made a number of such interventions and we will continue to do so where needed.”


The Central Bank has prioritised dealing with the impact of COVID-19 on the financial system and on consumers. In our COVID-19 and Business Interruption Insurance Supervisory Framework, we set out our expectations for insurers’ handling of COVID-19 related business interruption insurance claims. Consistent with the Central Bank’s approach to all aspects of financial regulation, we expect firms to adopt a customer-first approach to the resolution of issues.

The framework clearly sets out our expectations of firms for the fair treatment of customers. These core expectations have been emphasised with insurers throughout our extensive supervisory engagements with them since these issues first emerged. Furthermore, we made clear that they should pay the reasonable costs of customers in agreed test court cases that seek to determine issues for wider groups of customers.

The Central Bank’s supervisory approach is centred on identifying all groups of impacted policies where, in the view of the Central Bank, the relevant contractual provisions provide cover for COVID-19 related interruption and/or interference to businesses. Our analysis and supervisory engagement is industry-wide, with a view to identifying and addressing potentially systemic issues of breaches of legal and regulatory obligations and/or customer harm across groups of customers.