Richard Bruton (Dublin Bay North, Fine Gael)
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204. To ask the Minister for Finance if his attention has been drawn to the fact that persons who have recovered from Covid-19 are being denied mortgage protection for a period of six months resulting in persons who have paid a deposit on their home being put in a position in which they cannot complete the purchase (details supplied); and if he will make a statement on the matter. [10097/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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In most cases, a lender is legally required under Section 126 of the Consumer Credit Act 1995 to make sure that a mortgage applicant has mortgage protection insurance in place before granting a mortgage loan. However, there are certain exceptions where:

- the house in respect of which the loan is made is, in the mortgage lender's opinion, not intended for use as the principal residence of the borrower or of his dependants,

- loans to persons who belong to a class of persons which would not be acceptable to an insurer, or which would only be acceptable to an insurer at a premium significantly higher than that payable by borrowers generally,

- loans to persons who are over 50 years of age at the time the loan is approved,

- loans to persons who, at the time the loan is made, have otherwise arranged life assurance, providing for payment of a sufficient sum, in the event of death.

Within this statutory framework it is a matter for mortgage lenders to require that mortgage protection insurance is put in place in the context of mortgage credit and I have no involvement in such commercial requirements. Also it is important to note that I have a remit over the underwriting decisions made by insurers or have the power to direct insurance companies to provide cover to specific individuals or businesses. That is a commercial and operational matter for each particular insurer. This position is reinforced by the EU framework for insurance (the Solvency II Directive) which expressly prohibits Member States from doing so.

Nevertheless, the Central Bank has advised that in relation to insurance, and in line with previous guidance issued to the insurance industry in March 2020 (), the Central Bank expects that the insurance industry will play its part in protecting its customers during this extraordinary time, to be sensitive to the difficult situation in which many find themselves, and to take steps to support them. At all times, the Central Bank expects firms to consider the customer impact when making decisions and to engage with customers in an open, fair and transparent manner.

Also the Deputy may wish to note that my officials contacted Insurance Ireland, the representative body for insurance providers, on this issue recently. It stated that it is aware of cases where a final decision on applications is being deferred in instances where applicants have displayed symptoms of COVID-19, been referred for, or undergoing COVID-19 testing, or had a positive COVID-19 diagnosis. It is normal practice to defer a decision on any condition in these cases. However, it also stated that is unlikely that once the applicant has fully recovered from an illness that it would have any impact on the policy they are seeking to take out, although this does depend on the individual case and the severity of the impact of the infection.

More generally, the Deputy will also be aware that both Minister of State Fleming and I have consistently and publicly stated that in the context of COVID-19 we expect insurance firms to treat their customers fairly, honestly, and in accordance with the Central Bank’s Consumer Protection Code. The Government will continue to work to protect customers during and after the COVID-19 crisis, and engage with the insurance industry in relation to how it responds to the needs of its customers. This commitment is included in the Programme for Government.