Central Bank wants to increase fees paid by EEA insurers

Move designed to defray costs of increased oversight of overseas insurers in Ireland

The Central Bank plans to split the EEA insurers into three categories, for the purposes of determining the size of each firm’s levy. Photograph: Matt Kavanagh

The Central Bank plans to split the EEA insurers into three categories, for the purposes of determining the size of each firm’s levy. Photograph: Matt Kavanagh

 

The Central Bank is proposing to increase the sum it charges insurers who passport into Ireland from countries in the European Economic Area to meet the costs of their regulation.

This is one of the key items in a consultation paper issued on Monday by the Central Bank on how it intends to calculate the regulatory fees it charges credit institutions, investment firms, funds and EEA insurers.

At present, EEA insurers – which covers providers from other European Union member states, Iceland, Liechtenstein and Norway – are subject to a single low levy irrespective of their size and complexity.

However, a few of them are major players in the Irish insurance market and the Central Bank has had to increase its supervisory oversight of the sector following the demise here of Setanta Insurance, a Malta-based company, and Enterprise Insurance from Gibraltar.

Three categories

For the purposes of determining the size of each firm’s levy, the Central Bank plans to split the EEA insurers into three categories.

The first will be for large non-life and life insurers, to be levied at half the rate of medium-to-high insurers.

The second is for non-life insurers not belonging in the first category having written motor insurance here in 2016. These will be levied at half the rate of medium-to-low insurers.

The third category will be insurers not belonging to either of these two categories, who will be levied as before.

If these levies had been in place for 2016, the first category would have paid €91,731 each, the second €18,326 with the small firms continuing to pay €6,002.

In addition, it is proposed that EEA investment firms and fund service providers be subject to an annual funding levy from 2017 onwards. Based on 2016 figures, this would have amounted to €6,606.

The consultation process will run until April 28th.