Central Bank to extend scope of National Claims Information Database to Employers’ and Public Liability Insurance

• Central Bank feasibility study finds there is merit in extending the scope of the National Claims Information Database to include data on Employers’ and Public Liability Insurance.
• Credible, publicly available data in relation to Employers’ and Public Liability insurance would benefit all insurance market stakeholders.
• Data will be published as soon as possible with data collection to commence in H2 2020 and first report to be published in H1 2021.

The Central Bank has published a study on the merits and feasibility of including data on Employers’ and Public Liability (EL and PL) insurance in the scope of the National Claims Information Database (NCID). The study finds that there is merit in extending the scope of the NCID to include EL and PL data and it is feasible to do so, albeit with an incremental approach to data collection.

Speaking about the publication of the feasibility study, Mark Cassidy, Director of Economics & Statistics, said: “The Central Bank is focused on ensuring that the insurance sector sustainably serves the needs of the economy and its customers. Credible, publicly available data in relation to Employers’ and Public Liability insurance would benefit all stakeholders in the insurance market, and we intend to publish this data as soon as possible.

“It is clear from our study that there is currently a lack of publicly available data in relation to the claims costs and trends for EL and PL insurance. This deficit of data in this area does not allow conclusions to be drawn as to the causes of underlying trends in the EL and PL insurance market. This limits the ability to determine appropriate policy responses to address the issues in this area.”

Liability insurance consists of a broad range of business sectors, types and sizes, covering a variety of risks and this increases the complexity of data collection. The Central Bank intends to collect this data in H2 2020 and publish the first Employers’ Liability and Public Liability NCID Report in H1 2021, with annual publications of data thereafter. The final report will focus on data prior to and including 2019. Aggregate data on premiums, claims and settlement costs will be published as part of the Report.

In December 2019, the Central Bank published the first annual Motor Insurance Report of the NCID, which provided detailed data on the cost of motor insurance premiums, claims and settlement costs. This work, combined with the Employers’ and Public Liability NCID report, will deliver on a key Central Bank commitment to improve transparency and the understanding of the issues affecting the functioning of the insurance market in Ireland.

Notes:

• The Cost of Insurance Working Group’s (CIWG) Report on the Cost of Employers’(EL) and Public Liability (PL) Insurance was published in 2018 and recommended that the Central Bank of Ireland (the Central Bank) undertake a study to determine the merits and feasibility of including EL and PL insurance data in the National Claims Information Database (NCID). This report documents the output of that study.
• Liability insurance covers a broad range of insurances that a business may have in place to control the risks that they face in conducting their day-to-day business. The nature, scale and type of individual businesses is very diverse, therefore the type and level of insurance which a business will require will depend on the sector it operates in, its size (e.g., turnover, number of employees), and other factors. The main lines of liability insurance are Employers’ Liability (EL) and Public Liability (PL) insurance.
• EL insurance protects employers against claims for damages brought by employees. An employer may incur legal liability to an employee who sustains bodily injury or illness/disease which arises out of, and in the course of, employment. EL is not a compulsory class of insurance in Ireland but most employers will take out this cover as, otherwise, they would be liable for compensation in the event that an employee has an accident or develops an illness for which they (the employer) are deemed responsible.
• All businesses have legal responsibilities towards their customers and the public. If a person is carrying on a business there is a possibility that due to their business activities, injury or damage can be caused to another person or property. A Public Liability policy will provide the policyholder with protection in such events.