The Insurance Contracts Act 2019 (CICA) was signed into law in December 2019, with some sections of the Act delayed until 1 September 2021. As from that date, CICA will significantly change the way insurers contract with Irish consumers – such as individuals, farmers, sole traders, partnerships, charities and incorporated bodies with a turnover of less than €3m.

What does it mean for consumers and farmers?

CICA provides increased protection to consumers and farmers and applies a consumer focus to insurance contracts.

It indicates that the interpretation of pre-contractual questions and contract terms most favourable to the consumer will prevail.

This will require the insurer to take on additional responsibility in respect of its consumer interactions at key phases of the customer journey.

At the pre-contract/renewal stage, insurers will be required to provide additional information to consumers on paper or in a durable medium (such as email). Insurers must provide a schedule of all premiums and claims paid for the proceeding five years. This will show a farmer how profitable their business is or has been to the insurance company.

Key changes coming into effect on 1 September 2021:

  • Consumers and farmers will have a statutory duty to answer all questions posed by the insurer “honestly and with reasonable care” in place of the contractual duty of “utmost good faith” – a significantly lower standard.
  • There will be a limit on the insurer’s ability to use the remedies for non-disclosure (such as cancel a policy) unless the insurer can show that it would not have entered into the contract of insurance, or only would have done so under different terms.
  • Insurers will have a duty to provide more information to consumers pre-contract (on paper or by another durable medium). Insurers must ask questions that are specific, plain and intelligible. They cannot ask general questions. Insurers must inform consumers of the general nature and effect of the pre-contractual duty of disclosure before entering into a contract and at renewal. If there is any ambiguity about the meaning of a question, the interpretation most favourable to the consumer will apply.
  • There will be proportionate remedies for misrepresentation by the consumer (depends on whether innocent, negligent or fraudulent).
  • Insurers will have increased duties at renewal (a schedule of all premiums and claims paid for the preceding five years must be provided to the farmer).
  • Unless new information is provided by the consumer in response to an insurer’s request, the presumption is that the information previously provided still applies (provided continuous payment of renewal premium).
  • What does it mean for Insurance Companies?

    It means considerable change to the rules surrounding disclosure and places a significant onus on insurers to make sure they are gathering the correct information from consumers at the time the contract is being entered into.

    This will be particularly important for telephone and online sales as CICA will require insurers to provide additional information to consumers at the pre-contract/renewal stage on paper or in a durable medium.

    What does the Insurance companies say about these new rules?

    AXA Ireland head of agriculture Christy Doherty said: “Many of the provisions of the act are in line with AXA’s current business practice. The first thing some farmers will notice is a change to their renewal invitation notices in September. Farm renewals will now give more details on cover and previous responses to questions held on file by the insurer.

    “The new renewal notice will outline property insurance sums broken down, details of premiums paid over a five-year period, details of any claims paid and any outstanding during the same period.”

    He went on to say: “A farmer will be aware, possibly for the first time, how profitable their business is with that insurance company. Farmers who have previously not shopped around, can now find out if their current insurer is offering good value.”

    FBD Insurances corporate business manager Paul Murphy said: “We are committed to being honest and fair to our customers. The law provides additional supports in their engagements with insurers and remedies a perceived imbalance in bargaining powers between individual consumers and insurers.”

    Zurich Insurances senior communications specialist Neal Heavey said: “CICA marks a significant change for the Irish insurance industry in law and ensures many of these existing customer practices are reflected in law. We have invested in enhancing our systems and processes to continue to make it as easy as possible for our customers to do business with us.”

    Insurance Ireland

    Insurance Ireland, which is the leading representative body for Ireland’s insurance sector, confirmed that, on the whole, insurance companies are prepared for these changes. A lot of time, effort and costs have been undertaken by individual insurance companies to update their IT systems and in-house procedures to ensure they are compliant.


    The more transparent and straightforward it is for consumers and farmers to do business with insurance companies the better. Simplicity and transparency is the key to loyalty and customer retention. However, it appears the financial services sector in Ireland will continue to manage its way through a time of intense regulatory scrutiny.

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