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Consumer Insurance Contracts Act 2019 (CICA)

The Consumer Insurance Contracts Act 2019 (the Act) was signed into law on 26 December 2019. Certain sections of the Act were enacted in 1st September 2020, with further sections coming into effect 1st September 2021. 

The Act makes changes to the landscape of insurance in Ireland. Its main aim is to improve the transparency of policy wordings and insurer procedures and to strengthen your consumer rights. 

At Liberty Insurance, we are committed to ensuring you have all the information you need before and after you take out a policy with us. We continue to take steps to ensure our systems, policies and procedures are updated to comply with this legislation.

In September 2020 as part of CICA phase one, we introduced positive changes in how we operate and serve you as our customer, for example:

  • Short period cancellation rates were abolished
  • Policy booklets were updated in line with this legislation
  • Our claims handling procedures underwent some changes
  • Before and after sales information was enhanced

Below is a summary of the main sections enacted in September 2020.

The principle of insurable interest was enhanced. This means that we, as your insurer, cannot refuse liability by reason only that the name of the person who may benefit under the policy is not specified in the policy document (section 7)

The introduction of cooling off period of 14 working days, together with additional cancellation rights for you, the customer (sections 11 & 13)
The creation of post-contractual duties for the customer and insurer. The principle of “utmost good faith” is no longer valid (section 15). 
Insurers are under a duty to handle claims promptly and fairly, notify customers of a third-party claim (if not made by the customer) as soon as possible and inform customers when a claim is settled or closed (sections 16-19).
Changes to the insurers right to subrogation for any claim and extends third party rights. This includes the right of a third party to pursue an insurer directly via legal proceedings (sections 21-25).

What changes can you expect to see from September 2021?

Phase two of the CICA requirements will come into effect on 1 September 2021.

  • Customers will have a statutory obligation to answer all questions asked by the insurer 'honestly and with reasonable care'. This is a new requirement on customers and replaces the duty of 'utmost good faith', which is lower standard of duty (section 8)
  • Insurers will have limited remedies available to them to cancel an insurance policy for non-disclosure (section 8)
  • Insurers have a duty to provide customers with information before they take out or renew a policy. This information must be provided paper or another durable medium. 
  • The questions that insures ask must be specific, in plain and intelligible language, assumptions are no longer allowed.  Insures must inform customers, in general terms of the nature and effect of their pre-contractual duty of disclosure (section 8)
  • Insurers will have proportionate remedies available for misrepresentation by the customer (section 9)
  • Insurers will have further duties at renewal and must provide customers with a schedule of all premiums and claims paid for the preceding 5 years. (section 12)
  • At renewal, unless the insurer asks a customer specific questions it is taken that the information previously provided still applies and the customer continues to pay the renewal (section 14 (1) – (5)).

How can Liberty Insurance customers find out more?

You can find details of the full Customer Insurance Contracts Act 2019 at www.irishstatutebook.ie