President of the Irish Insurance Federation (IIF), Mr Gerry Hassett today called for increased dialogue between the Insurance Industry and the Central Bank with regards to future regulation and supervision standards.
Speaking at the IIF's AGM and Annual Lunch Mr Hassett also highlighted the urgent need for clarity around pensions policy.
Mr Hassett said that encouraging ordinary workers to save for their retirement was a noble cause and that the IIF remains concerned about Government policy on retirement savings. "Pension tax relief is not just about the wealthy. Eighty-five per cent of pension customers earn €70,000 a year or less so we are dealing with middle-income earners, many of whom have borne the brunt of recent austerity measures", he said.
He pointed to a recent survey that said seventy per cent of middle income workers did not believe the Government was actively trying to encourage people to save for retirement.
"Negative policy measures in relation to pensions has created a crisis of confidence in pensions planning, which could have a devastating impact on the future. Some people argue, and with merit, that the Government has more immediate problems to deal with. The facts are that there are six people working today for every one person in retirement. Within 20 years that ratio will halve. A failure to plan now for an entirely predictable outcome will lead to many middle income workers relying on the State pension. This in turn will become an unaffordable burden to the State," said Mr Hassett.
Mr Hassett commended the Central Bank on the critical and proactive role they have played in addressing key regulatory issues that have arisen during the past two years. He noted the unprecedented changes that have been introduced including new Codes on Corporate Governance, Fitness and Probity and revised Consumer Protection Codes.
"Insurance companies have demonstrated that they take their regulatory responsibilities seriously and have deployed significant additional resources to ensure regulatory obligations are met. However, as regulatory standards now reach European norms, indeed in several areas Irish standards now exceed European norms - I would ask the Central Bank to introduce more dialogue bank into the regulatory process to ensure the regulatory environment is effective and appropriate for both companies and consumers," said Mr Hassett.
IIF member companies hold assets in excess of €80bn - much of it in Ireland. International insurance business generates €20bn in exports every year and account for 65% of the jobs in the IFSC. Overall, more than 15,000 people are employed by insurance companies in Ireland and in ancillary services.
Article Published: 08/06/2012