Cen­tral Bank flagged con­cerns over plan for it to host in­sur­ance reg­is­ter

Irish Independent - Business Week - - BUSINESSWEEK - Colm Kelpie

SE­NIOR Cen­tral Bank of­fi­cials raised con­cerns in­ter­nally about at­tempts to have it as­signed re­spon­si­bil­ity for a na­tional data­base of mo­tor in­sur­ance claims.

Doc­u­ments re­leased un­der Free­dom of In­for­ma­tion to the Ir­ish In­de­pen­dent show the reg­u­la­tor be­lieved it would be in­ap­pro­pri­ate for it to be given the task, as it is in­de­pen­dent from Gov­ern­ment.

The prospect of a na­tional claims reg­is­ter or data­base emerged in the au­tumn of last year, and it was spec­u­lated that it could be housed in the Cen­tral Bank.

In an email to Gover­nor Philip Lane in Novem­ber, for­mer deputy gover­nor Cyril Roux said as­sign­ing re­spon­si­bil­ity for the data­base to the Cen­tral Bank would “not fall un­der the su­per­vi­sory tasks of the bank, nor un­der its sta­tis­ti­cal man­date”. He said Gerry Cross, the di­rec­tor of pol­icy and risk, also had con­cerns.

“Such a reg­is­ter would be com­pletely for­eign to the role and re­spon­si­bil­ity of a cen­tral bank,” Mr Roux wrote.

He ar­gued that an in­sur­ance claims reg­is­ter would face “in­su­per­a­ble lo­gis­ti­cal dif­fi­cul­ties”.

Gover­nor Lane said he gen­er­ally agreed.

In a let­ter drafted on be­half of Gover­nor Lane, and in­tended for then ju­nior Fi­nance Min­is­ter Eoghan Mur­phy, the bank noted that as­sign­ing re­spon­si­bil­ity for the data­base to the Cen­tral Bank as prob­lem­atic.

“Such reg­is­ter would likely face sig­nif­i­cant chal­lenges in terms of, in­ter alia, data pro­tec­tion leg­is­la­tion, re­quir­ing pro­pri­etary com­mer­cial sen­si­tive in­for­ma­tion, ac­cess­ing in­for­ma­tion from in­sur­ance un­der­tak­ings op­er­at­ing in Ire­land on a cross bor­der ba­sis, sig­nif­i­cant sys­tems changes and de­vel­op­ment costs both for in­sur­ance un­der­tak­ings and the body es­tab­lish­ing it,” the let­ter noted.

“The lead-in time for the es­tab­lish­ment for such a reg­is­ter would be sig­nif­i­cant, mea­sured in mul­ti­ple years. The scale of the chal­lenges for in­sur­ers could in­flu­ence firms’ de­ci­sions on busi­ness models in the Ir­ish mar­ket and the re­sul­tant in­dus­try costs may be passed on to pol­i­cy­hold­ers.”

It said that sev­eral coun­tries have de­vel­oped a data­base of na­tional claims statis­tics com­piled by an in­dus­try or pro­fes­sional body.

“In any case, I do not con­sider it ap­pro­pri­ate that the Cen­tral Bank be as­signed re­spon­si­bil­ity for the es­tab­lish­ment or ad­min­is­tra­tion of such sys­tems, as it would be as­crib­ing a gov­ern­men­tal task to an in­sti­tu­tion that is ac­count­able to the Oireach­tas, but in­de­pen­dent from Gov­ern­ment.”

A Cen­tral Bank spokesman said the let­ter was not sent, but an al­ter­na­tive was on De­cem­ber 6. The spokesman said it set out “how the Cen­tral Bank will as­sist in bring­ing for­ward more gran­u­lar in­for­ma­tion on mo­tor claims into the public do­main, while set­ting out the chal­lenges as­so­ci­ated with set­ting up a na­tional claims reg­is­ter”.

In Jan­uary, a Gov­ern­ment-backed re­port rec­om­mended a data­base be set up, ad­min­is­tered by the Cen­tral Bank.

It noted that the bank had high­lighted the im­pli­ca­tions with re­gard to its man­date, and said leg­isla­tive change would be needed.

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