Michael McGrath (Cork South Central, Fianna Fail)
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149. To ask the Minister for Finance the number of policyholders impacted by the failure of a company (details supplied) by insurance category, that is, home insurance, motor insurance and so on; and if he will make a statement on the matter. [53945/18]

Michael McGrath (Cork South Central, Fianna Fail)
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150. To ask the Minister for Finance the number of claimants here impacted by the failure of a company (details supplied) by insurance category; the rules relating to to the Insurance Compensation Fund for which claims receive 100% compensation and to which claims are subject to the 65% and €825,000 limit; the details of the claimants impacted by the failure of the company by those that fall into the 100% compensation cohort; the number that fall into the 65% and €825,000 limit; and if he will make a statement on the matter. [53946/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 149 and 150 together.

In response to the Deputy’s questions, my officials sought the relevant information from the Central Bank.

The Central Bank has indicated that as of end November 2018, there were 51,012 policyholders in Ireland that have been impacted by the developments with Qudos.Patrona Underwriting Ltd has issued a statement saying that policies remain valid and in force until their natural expiry date, however given the current Qudos position and in line with Central Bank recommendations they have provided brokers with options to replace all insurance covers with other providers at no extra cost to consumers. Qudos has published a Q&A for policyholders on its website - www.qudosinsurance.dk/qa/. The Central Bank advise that the vast majority of these have now been re-broked / transferred to new providers and have provided the following breakdown of the type of policies:

The Central Bank has also indicated that as of 14 December 2018, there was 1,544 open Qudos claims broken down by: Household 155 and Private Car 1,389. However until the solvency or otherwise of Qudos is determined it is not possible to say which compensation scheme may cover eligible claims (i.e. the Danish or Irish scheme).

In relation to the rules of the Irish Insurance Compensation Fund (ICF), the Deputy will be aware that its fundamental purpose is to provide a certain minimum level of protection for policyholders where an insurance company goes into liquidation. Under the scheme, as a general rule a claimant is entitled to a payment up to 65% of their claim or €825,000 whichever is the less. However the Insurance (Amendment) Act 2018 has increased the level of ICF coverage for all future third party motor claims from the 65% level to 100% with the additional 35% coverage financed through an ex-ante industry contribution.

Michael McGrath (Cork South Central, Fianna Fail)
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151. To ask the Minister for Finance the level of engagement between his Department and his Danish counterpart regarding the failure of a company (details supplied); and if he will make a statement on the matter. [53947/18]

Michael McGrath (Cork South Central, Fianna Fail)
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152. To ask the Minister for Finance the level of engagement between him and his Danish counterpart regarding the failure of a company (details supplied); and if he will make a statement on the matter. [53948/18]

Michael McGrath (Cork South Central, Fianna Fail)
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153. To ask the Minister for Finance the level of engagement between the Central Bank and Danish financial regulators regarding the failure of a company (details supplied); and if he will make a statement on the matter. [53949/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 151 to 153, inclusive, together.

In general terms I do not consider it appropriate for either me or my Department to engage with our counterparts in other Member States on regulatory/supervisory matters as in my role as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation, and have no role in the day to day supervision of insurance companies. However in the case of Qudos because of its rather unique circumstances, my officials have been in touch with their counterparts in the Danish Ministry of Finance.

The Danish Finance Ministry officials advised that as Qudos was in solvent liquidation (as at 10 December), all claims would be met. However, he also indicated that if ultimately Qudos is placed into bankruptcy, and this happens after 1 January 2019, that the Danish Insurance Guarantee Scheme will not be liable to meet these claims due to a legislative change in May 2018. They noted that the decision as to if and when Qudos is placed into bankruptcy is not one for the Finance Ministry and that they have no role in this matter. The Danish officials did indicate that there are no plans to amend the legislation in relation to the Danish Insurance Guarantee Scheme.

It should also be noted that my officials have also been in contact with the UK Treasury and the EU Commission, to set out the impact and importance of this issue for Ireland. UK customers have also been impacted by the failure of Qudos. My colleague Minister of State D’Arcy has met with Insurance Ireland who outlined their serious concerns about the additional cost that Qudos could place on the Irish insurance sector if it is liquidated on or after 1 January 2019.

My officials also continue to liaise with the Central Bank who advise that they are in very frequent contact with its Danish counterpart (DFSA), the supervisory authorities of other affected member states though an EIOPA established Collaboration Platform for Qudos.

I understand that the Danish liquidators are currently continuing their review of the company with a view to determining its underlying financial position. Once this exercise is concluded they will be in a better position to determine whether the company can pay existing claims. It is expected that more information regarding this matter should be available this week.

Michael McGrath (Cork South Central, Fianna Fail)
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154. To ask the Minister for Finance the level of engagement between his Department and his Danish counterpart on the failure of a company (details supplied); and if he will make a statement on the matter. [53950/18]

Michael McGrath (Cork South Central, Fianna Fail)
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155. To ask the Minister for Finance the level of engagement between him and his Danish counterpart on the failure of a company (details supplied); and if he will make a statement on the matter. [53951/18]

Michael McGrath (Cork South Central, Fianna Fail)
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156. To ask the Minister for Finance the level of engagement between the Central Bank and the Danish financial regulators on the failure of a company (details supplied); and if he will make a statement on the matter. [53952/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 154 to 156, inclusive, together.

In general terms I do not consider it appropriate for either me or my Department to engage with our counterparts in other Member States on regulatory/supervisory matters as in my role as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation, and have no role in the day to day supervision of insurance companies. Therefore in the case of Alpha there has been no engagement by my Department or myself with our Danish counterparts. It should be noted that because of the rather unique circumstances of Qudos there has been a telephone call between my officials and their Danish counterparts. This is outlined in another PQ answered today.

The Central Bank of Ireland has advised me that it was notified by the Danish Financial Supervisory Authority on 7 March 2018 that it had ordered Alpha Insurance A/S (“Alpha”) to cease writing new business including renewal of existing contracts and business with immediate effect. It was further notified on 9 May 2018 that the liquidators of the insurance company Alpha had filed a petition for bankruptcy.

As the Deputy is aware, the European Insurance and Occupational Pension Authority (EIOPA) is the pan-European authority with responsibility for oversight of the insurance industry. In 2017, EIOPA developed a cross-border platform of cooperation between National Competent Authorities (NCA’s) to provide all NCA’s with the opportunity to discuss concerns in relation to specific undertakings, local markets and share general market developments. The Central Bank has advised me that they participate fully in these platforms with other relevant supervisory authorities including the Danish Financial Supervisory Authority. They also confirmed that in relation to Alpha Insurance, there was a Platform established in which the Bank engaged with all relevant supervisors including their Danish counterparts.

Michael McGrath (Cork South Central, Fianna Fail)
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157. To ask the Minister for Finance the level of engagement his Department and the Central Bank have had with the liquidators of companies (details supplied); and if he will make a statement on the matter. [53953/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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As a general rule, it is not appropriate in my view for either my Department or the Central Bank to engage directly with the liquidators of insolvent insurers in other Member States. Instead in the cases in question (Qudos and Alpha) the Central Bank has liaised with its Danish counterparts (the Danish Financial Supervisory Authority (DFSA)), in order to try and obtain whatever information is required from the liquidators.

As the Deputy is aware, the European Insurance and Occupational Pension Authority (EIOPA) is the pan-European authority with responsibility for oversight of the insurance industry. In 2017, EIOPA developed a cross-border platform of cooperation between National Competent Authorities (NCA’s) to provide all NCA’s with the opportunity to discuss concerns in relation to specific undertakings, local markets and share general market developments. The Central Bank has advised me that they participate fully in these platforms with other relevant supervisory authorities including the Danish Financial Supervisory Authority (DFSA).

In relation to Qudos, the Central Bank advise that they are in very frequent contact with its Danish counterpart (DFSA), the supervisory authorities of other affected member states though the EIOPA established Collaboration Platform. The DFSA liaises with the liquidator and provides updates to the platform members. I understand that the Danish liquidators are currently continuing their review of the company with a view to determining its underlying financial position. It is expected that more information regarding this matter should be available this week.

The Central Bank have also confirmed that in relation to Alpha Insurance, there was a Platform established in which the Bank engaged with all relevant supervisors including their Danish counterparts.

Details of the liquidators appointed for both companies have been published on their respective websites.

Michael McGrath (Cork South Central, Fianna Fail)
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158. To ask the Minister for Finance his views on the establishment of an EU-wide insurance compensation fund to deal with the aftermath of insurance company failures; his views on whether such a mechanism will be established to improve the EU-wide insurance market; and if he will make a statement on the matter. [53954/18]

Michael McGrath (Cork South Central, Fianna Fail)
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159. To ask the Minister for Finance his views on whether each member state in the EU should have an insurance compensation fund to deal with the aftermath of insurance company failures; his further views on whether such a proposal will be forthcoming from the European Commission; and if he will make a statement on the matter. [53955/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 158 and 159 together.

I am supportive of the general idea of greater harmonisation at EU level for insurance guarantee schemes (IGSs) as this would serve to enhance policyholder protection and ensure a more equitable outcome for policyholders and claimants in different Member States.

The current situation whereby Member States have adopted their own approach to insurance guarantee schemes, which show noticeable differences in design features, such as scope, coverage (e.g. geographical or by product line) and funding is not satisfactory. For instance, I understand, based on reports published from various sources including the European Insurance and Occupational Pension Authority (EIOPA) and EU Commission, that there are, 26 Insurance Guarantee Schemes (IGSs) (or similar schemes) established in 20 Member States: eight IGSs operating on the basis of the host-country principle, eight operating on the home-country principle and eight schemes with a combination of both. The remaining two schemes are undefined. In addition, IGSs do not exist in the following EEA Member States: Croatia, Cyprus, the Czech Republic, Iceland, Liechtenstein, Lithuania, Luxembourg, the Netherlands, Slovakia, Slovenia and Sweden.

These differences in national Insurance Guarantee Schemes (IGSs), together with differences in insolvency laws, have led to a situation where policyholders across or even within the same Member States are not protected to the same extent in liquidation. Therefore it has been difficult to arrive at a common EU position in relation to IGSs. However, there has been considerable efforts on the issue, including a number of reports and initiatives in recent years:

- A 2010 Commission white paper on the introduction of an EU wide framework of Insurance Guarantee Systems. No significant progress was made on this framework subsequently as the development of Solvency II was the priority piece of work at the time.

- A 2015 Commission discussion paper on the possibility of introducing a recovery and resolution regime for insurance undertakings which could include an Insurance Guarantee Scheme.

- In 2017 the Commission issued a questionnaire to all Member States seeking information on Recovery and Resolution including experiences with failures and near-failures of insurers.

- The European Systemic Risk Board published a report “Recovery and Resolution for the EU insurance sector: a macro prudential perspective” in August 2017. The Central Bank of Ireland was represented on the drafting team.

- EIOPA published an Opinion to Institutions of the European Union on the Harmonisation of Recovery and Resolution Frameworks for (Re) Insurers (July 2017).

- Work is also underway at an EIOPA level, where a project group has been set up to examine more broadly recovery and resolution within insurance and in relation to Insurance Guarantee Schemes, a discussion paper was published on this topic.

In addition, the Deputy should note that the European Commission proposed an amendment to the Motor Insurance Directive which would oblige member states to set up Insurance Guarantee Schemes to cover the cost of insolvent motor insurers. I support this measure and my officials are actively participating to ensure that the legislation is strong and in the best interests of Ireland, given the large insurance industry here and our previous experience with insolvent inward-Freedom of Services (FoS) insurers.

Finally, while the provision of cross-border insurance is an essential part of the Single market, and it is acknowledged that there are obvious difficulties which arise when an insurer fails, it should be noted that Solvency II is not a 'no-failure' regime as it would not be possible to build a viable system that provides a cast iron guarantee that no insurer will ever fail. Consequently it is important that EU supervisors properly and consistently supervise the insurers that they authorise, and that there is greater communications between supervisors across the EU about their respective companies conducting cross-border business. You should also be aware that as part of the ongoing review of the European Supervisory architecture, there is a proposal to further improve cross-border co-operation and communication through the strengthening of Cross-Border Collaboration Platforms. These already operate on an ad-hoc basis, however this proposal would ensure a more formal structure is put in place where an insurer is doing a lot of cross border business. This would therefore give the supervisors of countries into which insurance is written a greater insight into how the business is being conducted.

Michael McGrath (Cork South Central, Fianna Fail)
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160. To ask the Minister for Finance when the law was changed governing the Danish guarantee fund to deal with insurance company failures in 2018; and if he will make a statement on the matter. [53956/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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At the outset I would like to say that as there is currently no EU harmonised approach to insurance guarantee schemes. Member States have adopted their own approach to such schemes, which show noticeable differences in design features, such as scope, coverage and funding.

I understand that the Danish scheme for non life companies (Garantifonden for skadesforsikringsselskaber) was established on 1 October 2003 and comes under the remit of the Consolidated Act on the Guarantee Fund for Non-life Insurance. This Act was most recently amended by Act No. 375 of 1 May 2018, which changed the scope of the Fund from a home-country principle to a host-country principle, with effect from 1 January 2019, and requires all insurers writing business in Denmark to be a member of the Danish Insurance Guarantee Fund.

The difference between a host based insurance guarantee scheme and a home based one is that the former only covers policies or risks in that state no matter where they are written from, whereas the latter covers all policies issued by domestically authorised insurers whether sold in that state or in other member states via branches or Freedom of Services (FoS).

It should be noted that the Irish Insurance Compensation Fund (ICF) is a host-based scheme.

In conclusion, while the provision of cross-border insurance is an essential part of the Single market, it is acknowledged that there are obvious difficulties which arise when an insurer fails. It is important therefore that EU supervisors properly and consistently supervise the insurers that they authorise, and that there is greater communications between supervisors across the EU about their respective companies conducting cross-border business.

Michael McGrath (Cork South Central, Fianna Fail)
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161. To ask the Minister for Finance the number of persons that have applied to the declined insurance scheme run by an organisation (details supplied) in each month in 2018; and if he will make a statement on the matter. [53958/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy is aware, under the terms of the Declined Cases Agreement (DCA), which is adhered to by all motor insurers in Ireland, the insurance market will not refuse to provide insurance to an individual seeking motor insurance if he or she has approached at least three insurers and has not been able to obtain cover from them.

I am not responsible for the operation of the DCA and therefore I do not have direct access to the number of applications made under the DCA process during 2018 to date.

However, in order to be as helpful as I can, my officials contacted Insurance Ireland seeking the DCA application figures. In response, Insurance Ireland provided statistics on the number of cases it dealt with in the first half of 2018. In relation to these cases, Insurance Ireland has informed my officials that all applications submitted were accepted by Insurance Ireland for processing under the DCA.

The month-by-month figures for the first half of 2018 are:

Therefore, the total number of applications for the first half of 2018 was 660. This compares to 789 applications for the corresponding period in 2017.

It should be noted that the Cost of Insurance Working Group recommended the Declined Cases Agreement process should be made more transparent under the Report on the Cost of Motor Insurance. On foot of this recommendation, Insurance Ireland agreed to submit an annual report on the operation of the Agreement to my Department. In the first such report, Insurance Ireland stated that it “believes that the time may be correct for a review of elements” of the Agreement. My Department accepted this proposal and has since hosted a number of workshops with relevant stakeholders who are examining what elements of the Agreement need to be amended or refined. I understand that the next such workshop is scheduled to take place in early 2019. I am also informed that the DCA figures for the whole of 2018 will be contained within the next annual report, which is due to be submitted by Insurance Ireland in the first quarter of next year.