With the leaving and junior certificate currently putting many households through the emotional wringer, it seems timely to consider what exams your company might face in the coming months. The Central Bank of Ireland (the “Central Bank”) has recently published various documents and speeches that indicate the questions that might come up this year. No doubt you knew the value of tips from the person setting the exam when you were in school, so why ignore these tips now?
As Mr Cyril Roux has highlighted, the regulatory agendas of national regulators across Europe are being driven by EU-led initiatives. For the insurance sector, Solvency II is therefore an obvious area of focus for the Central Bank. The Central Bank’s most recent edition of Solvency II Matters sets out the challenging timeline for implementation of Solvency II and highlights the various areas where EIOPA is currently looking for feedback. For some, Solvency II preparations will occur simultaneously with EIOPA’s stress tests, with the result that the summer months may prove to be much busier than usual.
Life-assurance companies should take note that Mr Roux has repeatedly stated that anti-money laundering (“AML”) is an area where companies “can expect supervisory focus … to remain high”. Mr Roux’s view is that Ireland has “a distance to travel in this area if we are to reach international standards or best practice”. In this context, Mr Roux highlighted that, in 2016, the Financial Action Task Force will review Ireland’s compliance with AML standards. These statements imply that the Central Bank is not yet satisfied with the standard of AML compliance, and suggest that this will be a priority area for at least the next two years.
In both of his public speeches since taking up his role in the Central Bank, Mr Roux emphasised consumer protection as a priority (those sentiments being recently echoed by Mr Gabriel Bernardino of EIOPA). The priority afforded to this area is evidenced by quite a few settlement agreements in recent years. The Minimum Competency Code and the Consumer Protection Code are the two most obvious sources of consumer-facing requirements. Companies should not forget to regularly review their conditions of authorisation, however, as these contain additional requirements (and not just in the area of consumer protection).
Insurance and reinsurance intermediaries should pay heed to the latest edition of Intermediary Times. Professional-indemnity insurance is an area that has previously been highlighted as a priority by the Central Bank. The results of the latest review of this area, however, show that issues persist. Of 31 intermediaries contacted as part of that review, 18 had no cover at all. Additionally, where policies had been taken out, those policies often failed to meet the requirements.
Intermediary Times also stresses that advertising requirements in the Consumer Protection Code are commonly breached. The Central Bank has pointed out that a regulatory sanction is not the only consequence associated with non-compliant advertisements. Withdrawing advertising campaigns can, for example, result in unnecessary costs being incurred. Additionally, misleading advertisements could come back to haunt you if a customer makes a complaint in the future.
You will not want to fail your exams on these topics. Not only may you have to face repeat exams next year, but sanctions and reputational issues can also prove significant. If you need grinds in any of these areas, William Fry’s (re)insurance experts will be happy to help.
Contributed by: Grant Murtagh
