CAR INSURANCE companies have been warned to pay claims on time and to alert policyholders to the effect of settling claims on future no-claims bonuses.
The Central Bank said insurers have to adhere to the terms of the consumer protection code, which also includes a requirement to inform claimants of settlement offers in writing, and not just verbally.
An inspection by the bank of 10 insurers’ files found a generally high level of compliance with the code for third-party claims. The inspection found that firms do not treat third-party claimants differently from their own customers.
However, the inspection found that some firms had missed the deadline for paying claims within 10 working days by a few days.
It also found that some firms told customers about the effect of settling a claim on future insurance contracts only at the time they were renewing their policy. The code requires firms to inform customers at the time of processing the claim, thereby giving them the option of meeting the cost of the claim in order to protect a no-claims discount.
In one case, a claim was delayed because the firm had not received a completed claim form from the policyholder. The bank expressed concern that this could cause unnecessary delays for third-party claims.
The inspection found firms provided a reasonable level of assistance to third-party claimants and tried to pay claims with a minimum of delay once liability was accepted.
