Welcome to Issue 4 of the Grant Thornton FS Download. This issue summarises the current hot topics across the Financial Services sector in Ireland.

Asset Management

Financial Services - Asset Management and Investment Funds brochure

At Grant Thornton, we have a dedicated Asset Management and Investment Funds team. Our distinctive horizontal service offering and methodology has been developed from listening to our clients.

8th Irish Funds Annual UK Symposium

Our Financial Services Audit Director, Sarah Bradley was the MC for the 8th Irish Funds Annual UK Symposium in London

International Financial Services in South West Showcase

Our Financial Services Audit Director, Alan Cuddihy was the MC for the International Financial Services in South West Showcase


Recovery Planning

With the publication of the Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Recovery Plan Requirements for Insurers) Regulations 2021 in 19 April 2021 requirements have been placed on (re)insurers in relation to recovery planning in order to ensure that if an insurance undertaking fails, it is in an orderly manner without significant financial stability impact or consumer protection detriment.

IFRS 17 – Insurance Contracts

At its March 2020 meeting, the International Accounting Standards Board deferred the effective date of IFRS 17 Insurance Contracts for a year to 1 January 2023, with early application permitted. 

Insurers and Climate Change

As is the case globally climate change is receiving more and more attention within the Central Bank.

Cyber insurance coverage costs soaring

The cost to policyholders of obtaining cyber coverage has increased significantly over the past 12 months and with rate increases of a similar magnitude predicted for the coming year, insurers and reinsurers accepting cyber risks have witnessed substantial top-line growth. Whilst this development is positive for (re)insurers’ reported revenues, the additional cost burden of obtaining such an insurance policy could restrict the ability of start-up and smaller scale enterprises to obtain adequate cyber risk cover. With the increased frequency and severity of cyber attacks self-apparent, there is also the question of the impact of writing such policies on (re)insurers’ bottom-lines as claim costs will likely increase as attacks become more sophisticated.


Central Bank of Ireland (CBI)

The Central Bank of Ireland has published the third annual Private Motor Insurance Report of the National Claims Information Database (NCID). Some of the findings published:

  • Average earned premium decreased by 7% from 2019 to 2020. During the period 2009 to 2020, the annual average earned premium increased by 26%. 
  • The average claim cost per policy decreased by 20% from 2019 to 2020, reflecting the impact of Covid-19. There was a significant drop of 26% in the frequency of claims (injury and damage combined) in 2020.

For more details visit https://www.centralbank.ie/news/article/third-private-motor-insurance-report-of-the-national-claims-information-database-published-16-november-2021


IFRS 17 – European Union adoption confirmed

The European Union has published a Commission Regulation on 23 November 2021 endorsing IFRS 17 'Insurance Contracts'. The regulation adopts IFRS 17 Insurance Contracts and the June 2020 amendments to IFRS 17 with the same effective date as the IASB (1 January 2023).

Interest Limitations

Finance Bill 2021 - Interest Limitation Rules

In accordance with the first EU’s Anti-Tax Avoidance Directive (‘ATAD’), Ireland was required to introduce interest limitation rules (“ILR”). These rules will apply for accounting periods commencing on or after 1 January 2022.

Ireland’s Interest Limitation Rules

Finance Bill 2021 (‘the Bill’) introduced a new interest limitation rule (‘ILR’) as required by the EU’s anti-tax avoidance directive (‘ATAD’). This will have implications for taxpayers which have interest expenses in excess of interest income (known as ‘exceeding borrowing costs’).


Delegated Acts incorporating sustainability issues and considerations

On 21st April 2021, the European Commission adopted Delegated Acts (non-legislative acts adopted by the European Commission to amend or supplement legislation) amending the current UCITS, AIFMD and MIFID II legislation as part of its wider initiative to continue transforming EU’s economy into a sustainable financial system and become carbon neutral by 2050.

Supervisory Expectations of Regulated Firms Regarding Climate and Other ESG Issues

On the back of the 26th UN Climate Change Conference of the Parties (COP26), the Central Bank of Ireland (“CBI”) issued a letter on 3 November 2021 to all Chairs and CEOs of Regulated Financial Services Providers (“RFSPs”) outlining its supervisory expectations of RFSPs regarding climate and other environmental, social and governance (“ESG”) issues.