Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

Several of the companies made the point that the banks may reduce their rates because there is less risk in respect of pricing the loans. Experience, however, tells us we cannot rely on that. We need to assume that the full costs of this insurance product will be passed on to the consumer. We have to assume that. The banks may well use the reduced risk to increase their profit margin on a variable rate loan. The key issue is pricing and cost because anyone taking out a mortgage in Ireland today will more than likely be on a variable rate of between 4% and 4.5%, which is quite high in international terms. Anything that increases the cost is an issue.

What then triggers a pay-out? That was not covered in any of the presentations.