Insurance Companies Who Cut Covid Supports “Must Return Money To The State”

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Minister of State Department of Finance with responsibility for Financial Services, Credit Unions and Insurance, Seán Fleming (Image: Irish Examiner)

Insurance companies which cut Covid-19 supports from payouts “must return money to the state”.

This is according to Minister Seán Fleming, who says government payments were made to help businesses struggling through pandemic, not to reduce liability of insurers. FBD Insurance is seeking to strip thousands of euro from awards made to struggling businesses by withholding the value of government supports such as Covid-19 wage subsidy schemes and rates waivers.

Insurance companies deducting the value of government supports from payouts to businesses have been told they must return the money to the State and that they will not be “left off the hook” for failing to do so. Sean Fleming, who chairs the Oireachtas Public Accounts committee, issued the warning to the Insurance sector.

The indemnity principle should apply, which ensures that an insurance contract compensates for any damage, loss, or injury, but not to allowing the policy holder to make a profit. Earlier this year the sector lost a legal battle when the Save Irish Pubs group won a case ensuring that insurance companies had to pay out on Business Interruption policies. They had initially declined to honour the policies.