The Consumer Insurance Contracts Act 2019 (the “Act”), came into effect on September 1st, 2020 and reforms the law applicable to consumer insurance contracts.
A consumer is defined in the Financial Services Pensions Ombudsman Act 2017 and includes personal consumers i.e. motor and household customers and commercial businesses with an annual turnover of €3m or less in the previous financial year.
The Act aims to amend the duties of insurers and consumers following several years of work by the Law Reform Commission. RSA welcomes the changes brought about by the Act. All sections of the Act are immediately operative, from the above date, apart from sections 8, 9,12 and 14 (1-5) which are due to come into effect from 1st September 2021.
What is RSA doing in response to the Act?
We have reviewed our policy wordings and documentation and will update them to ensure that they are compliant with the Act. While your policy document may not yet contain these changes, we assure you that we will be complying fully with the sections of the Act that came into effect from 1st September 2020.
The purpose of this document is to highlight to you some of the key changes that we are now making to your policy. These changes are effective as of 1 September 2020.
Key changes that apply now to your Policy
- Where we alter the terms and conditions of your policy, we will notify you no later than 20 working days before your renewal date.
- Where we cancel your policy, we will refund you the balance of the premium, that you have paid, for the unexpired term of your contract.
We will continue to handle your claims in compliance with the Central Bank of Ireland Consumer Protection Code 2012. In accordance with the Act, we will continue to handle promptly and fairly any claim made
The Act reminds you of your duty to report claims within a reasonable time and requires you to respond to reasonable requests for information in an honest and reasonably careful manner.
Where it is not possible to quantify the total value of the claim within a reasonable time but where part of the total value has been quantified, we shall pay that part to you within a reasonable time. We will also disclose any information of which we become aware that supports or prejudices the validity of your claim and you will also be required to disclose such information to us.
In the event of a claim, we will bring to your notice any policy conditions under which we are not obliged to pay the full amount unless and until repair, replacement or re-instatement works have been completed and specified documentation has been furnished to us. Where such conditions apply, the amount of the “claim settlement amount” as defined by the Act, that we can defer are a) 5% of the claim settlement amount in a case in which the claim settlement amount is less than €40,000 or b) 10% in a case in which the claim settlement amount is €40,000 or more.
Where a claim contains information that is false or misleading and you know, or you consciously disregard whether it is false or misleading, we shall be entitled to refuse to pay the claim and we shall be entitled to cancel the contract of insurance.
The Act also allows third parties to make a claim directly against your insurance policy where a) the person insured under a contract of insurance has died, cannot be found or is insolvent and b) where the person insured under a contract of insurance lacks capacity or fails or refuses to communicate with the third-party who suffered injury or loss.
If you require further advice or assistance, please contact your broker or visit the RSA Ireland website here.
Please retain a copy of this communication with your policy documentation.
If you require more information, a full copy of the Act is available at www.oireachtas.ie