IIF wants clarification over failings to comply with insurance code

THE Irish Insurance Federation (IIF) wants greater clarification from the Central Bank over claims that the majority of insurance firms are failing to comply with the consumer protection code.

While the IIF has criticised insurance firms who fail to comply with the code, it has also claimed that recent Central Bank findings into the matter lack sufficient clarity.

The Central Bank has reported results of its own survey of 12 companies and their compliance levels with the code, in terms of complaints handling processes.

Those results showed that none of the firms questioned were fully compliant with all requirements of the code.

The inspection found that a number of firms had a low level of compliance in relation to complaints handling.

While no firms were mentioned and little data was published, the Central Bank claimed that the companies surveyed represented over 60% of the life assurance market, by sales volume, and 35% of the non-life sector.

On the back of the findings, the Consumers’ Association of Ireland called for the matter to be brought to the attention of the Financial Services Ombudsman and the IIF.

However, the IIF — while broadly in favour of the code — has cast doubt on the Central Bank’s findings; asking whether those surveyed were all insurance companies, intermediaries or a mix of both.

This is on the back of the lack of actual data released on the matter by the Central Bank.

The code is currently under review and set to be republished later this year.

IIF chief executive Mike Kemp said: “While there have been complaints that the code is too prescriptive, the current code has generally worked well to date.

“The rules are very clear and it shouldn’t be hard for any company to comply, once they put in a bit of time and effort,” Mr Kemp said.

“The fact is, it is in place and firms still have to comply; so we can’t defend anyone who doesn’t,” the IIF boss added.

While one of the concerns of the Central Bank inquiry was that numerous firms weren’t informing customers of their right of appeal to the Financial Services Ombudsman, that office actually reported last week that, during the second half of 2010, it received a record high of complaints from consumers about various investment and insurance products.