Insurance policies

Insurance policies could be impacted by banks’ exit

Insurers have urged customers of Ulster Bank and KBC Bank Ireland to be aware of the risks to their insurance and pension policies posed by the departure of the two lenders.

Insurance Ireland said customers of banks whose policies are paid for by direct debit should ensure they update payment details and mandates to avoid them becoming lapsed or discontinued.

The warning comes ahead of the freezing of the first tranche of Ulster Bank accounts from Friday.

“To ensure policy continuity, Ulster Bank and KBC customers should act urgently and update direct debit mandates for all their insurance products to their new bank account,” said Moyagh Murdock. , managing director of Insurance Ireland.

“If a policy expires, customers risk losing their cover, so it’s important to act now so you don’t miss out. It may not be possible to reinstate an expired policy with the same terms and conditions.”

“This may need to be treated as a new policy, which means consumers risk losing benefits accrued over time.”

As an example, Insurance Ireland pointed out that it is compulsory to have car insurance if you are driving a car on public roads and if someone is involved in a collision without cover the consequences could be very serious.

He also referred to the risk of a home sustaining storm or fire damage without a cover in place.

“If your health policy expires, you risk losing coverage for pre-existing conditions and having to book waiting periods,” Ms Murdock said.

“You may also be liable for additional loading charges for the Lifetime Community Rating, which can be quite significant if you do not purchase health insurance 13 weeks after the policy is cancelled.”

The organization also warned that recipients of pensions could see them cut short if their account is frozen.

“Customers who receive a regular payment from a provider, for example a pension payment, will also need to contact their insurer or pension provider and provide updated bank account information so that payments can continue without interruption,” said Ms. Murdock.

“Many insurance and pension providers have specific web pages and online forms on their websites to help their affected customers and guide them through the transfer process for their direct debits.”

She added that if someone discovers that their policy has involuntarily expired, they should contact their insurer or broker immediately, as an updated direct debit mandate can take up to 14 days to process.