Jim O'Callaghan (Dublin Bay South, Fianna Fail) | Oireachtas source

The Minister of State is very welcome to the committee. This is interesting legislation. The primary purpose of it is to transpose the amending directive in respect of insurance companies that become insolvent.

We have a history in Ireland of insurance companies going insolvent, regrettably. Presumably, the purpose here is that if a company goes insolvent, individuals insured by that insurance company will be entitled to make a claim to the compensation body, the MIBI, in respect of the insurance they are due, and that will be paid out of the fund. Is that correct?

Regarding the contributions to the fund, there is money in the insurance fund at present. Am I correct in saying that the Central Bank will issue a direction under section 6 that this new fund will be increased as a result of contributions directed by the Central Bank of moneys to come from the fund that exists at present? How will that operate?