On 15 July 2026, the Insurance (Disregard of Certain Medical History and Miscellaneous Provisions) Act (the 2026 Act) was signed into law.

While much of the attention surrounding the 2026 Act has focused on the so-called “right to be forgotten” introduced in respect of a mortgage protection insurance applicant’s previous cancer diagnosis, the 2026 Act also introduces a number of other significant changes relevant to Irish (re)insurers in Part 3 of the Act.

In addition to setting out various amendments to the Insurance Act 1964 regarding the obligations of certain insurance undertakings to contribute to specified sub-funds of the Insurance Contribution Fund, perhaps most notably Part 3 of the 2026 Act significantly expands the Central Bank of Ireland’s (Central Bank) winding-up powers in respect of assurance companies. This includes an expansion of both the firms to which the Central Bank’s winding-up powers apply and the grounds on which those powers may be exercised.

Following the commencement of Part 3 of the 2026 Act on 26 August 2026, Irish (re)insurers should consider the implications of the expanded regime and the increased scope of these powers.

What was the position previously?

Section 45 of the Insurance Act 1936 permits the Central Bank to petition the High Court for the winding-up of an assurance company.

Prior to the 2026 Act, the Central Bank could only seek a winding-up order where the insurer was unable to pay its debts. In addition, these powers applied only to authorised insurers and did not extend to reinsurers.

As a result, the Central Bank’s ability to intervene was largely linked to traditional insolvency concepts and generally required evidence that the insurer was already experiencing significant financial distress.

Key changes introduced by the 2026 Act

The 2026 Act substantially broadens the circumstances in which the Central Bank may petition for the winding-up of an assurance company.

Following the commencement of Part 3 of the 2026 Act, the Central Bank can now seek a winding-up order on any of the following grounds:

• Where the assurance company is unable to pay its debts – This ground largely reflects the existing position. Broadly speaking, an assurance company may be regarded as unable to pay its debts where it fails to discharge debts exceeding €10,000 (or €20,000 where owed to multiple creditors) within 21 days of a formal demand, or where the court is otherwise satisfied that it cannot meet its liabilities.

• Where a winding up would be, in the opinion of the Central Bank, in the public interest – The legislation does not define “public interest”, while considerations such as market confidence and serious regulatory non-compliance may prove relevant, it remains to be seen how this ground will be applied in practice. The inclusion of this standalone ground is significant, as it permits the Central Bank to seek a winding-up order in circumstances that extend beyond traditional insolvency concerns and reflects a broader supervisory and regulatory focus.

• Where the assurance company is, or in the opinion of the Central Bank may be, unable to meet its obligations to policyholders – This is a forward-looking ground and does not require the Central Bank to establish actual insolvency. The fact that the Central Bank may act where an assurance company “may be” unable to meet its obligations again suggests that intervention may be possible at an earlier stage, when concerns arise regarding its financial position or its ability to meet policyholder claims.

• Where the assurance company has failed to comply with a direction issued by the Central Bank in accordance with section 18 of the Insurance Act 1989, or section 45 of the Central Bank (Supervision and Enforcement) Act 2013 – These provisions confer extensive supervisory powers on the Central Bank, including powers to restrict new business, investments, transactions and other activities of regulated firms in prescribed circumstances. Failure to comply with such directions may now itself provide a basis for seeking a winding-up order.

• Where the assurance company’s authorisation has been withdrawn or revoked by the Central Bank – The inclusion of this ground allows the Central Bank to seek a winding-up order following the withdrawal or revocation of authorisation, even where traditional insolvency grounds may not yet have been established.; or

• Where the Central Bank considers a winding-up in the interests of policyholder – This ground is distinct from the broader public interest test and further emphasises the legislation’s focus on policyholder protection. As with the public interest ground, the Act does not specify the factors to be considered and further guidance is likely to emerge in practice.

These changes represent a significant departure from the previous framework. The Central Bank’s powers will no longer be limited to circumstances involving established insolvency. Instead, the legislation introduces broader public-interest, regulatory compliance and policyholder protection grounds, several of which are prospective in nature and may permit the Central Bank to seek a winding-up order before a traditional insolvency test has been satisfied. This reflects a broader shift towards earlier regulatory intervention where concerns arise regarding an assurance company’s viability, compliance or ability to meet its obligations to policyholders.

Reinsurers are now within scope

The 2026 Act also expands the definition of “assurance company” for the purposes of sections 44 to 47 of the Insurance Act, 1936.

As a result, the winding-up regime will now apply not only to insurers but also to reinsurers authorised by the Central Bank. This closes a gap in the existing framework and aligns the treatment of reinsurers more closely with that of insurers.

Why are these changes being introduced?

The amendments are intended to strengthen the Central Bank’s powers when dealing with insurers and reinsurers experiencing financial difficulty or where concerns arise regarding their ongoing viability.

The reforms respond to recommendations from the International Monetary Fund’s Financial Sector Assessment Program and implement commitments set out in the Government’s Action Plan for Insurance Reform 2025-2029. More broadly, they bring the insurance sector into closer alignment with supervisory and intervention powers that already exist in other areas of financial services regulation. The changes also reflect a policy objective of enabling the Central Bank to act at an earlier stage where policyholder interests or financial stability concerns arise, rather than waiting until a (re)insurer is demonstrably insolvent.

The expanded winding-up powers will also sit alongside the new recovery and resolution framework to be introduced under the Insurance Recovery and Resolution Directive (IRRD), which is due to be implemented in Ireland in January 2027 (see our related articles on the IRRD regime here and here). Together, these measures will further enhance the Central Bank’s toolkit for addressing insurers and reinsurers in financial distress.

Key takeaways

The changes introduced by the 2026 Act reflect a clear policy shift towards earlier and more flexible regulatory intervention in situations involving actual or potential insurer distress. The expansion of the CBI’s winding-up powers, particularly the introduction of public-interest and policyholder-protection grounds, moves the regime beyond a purely insolvency-based framework.

Notwithstanding the broader grounds for intervention, a winding-up order must still be obtained from the High Court. The amendments therefore expand the circumstances in which the Central Bank may petition for a winding-up, rather than creating an administrative power to wind up an insurer directly.

Following the commencement of these provisions of the 2026 Act on 26 August 2026, Irish (re)insurers should review the new regime carefully and assess any implications for their governance, risk management and regulatory compliance arrangements.

If you would like to discuss the implications of the 2026 Act for your business, please contact a member of William Fry’s Insurance or Restructuring & Insolvency teams, or your usual William Fry contact.

Contributed by: Ellis Witcher; Declan Keane & Catherine Carrigy