MIICF LEVY TO END IN 2025 – MIBI
The insurance levy contribution to the Motor Insurers’ Insolvency Compensation Fund (MIICF) is to end from the 1st January 2025. The announcement was made in the Budget speech by Minister for Finance, Jack Chambers TD.
The Motor Insurers’ Bureau of Ireland (MIBI) who manage the fund, confirmed the value of the fund is expected to exceed the €200 million threshold by June 2025. The MIICF process was designed that the fund would stop collecting money when it reached that point, with Section 3G (5) of the Insurance Act 1964 (as amended) providing this authority to the Minister.
MIICF was set up to act as a ‘rainy day fund’ to protect against motor insurance insolvencies like those seen in the cases of Setanta and Enterprise Insurance. The fund began collecting in June 2019.
It works by enabling ‘top up’ payments made under the Insurance Compensation Fund (ICF), which is part of the mechanism used to cover claims arising from any potential insolvent motor insurance company.
Claims to the ICF are capped at 65% of the value of the claim, but thanks to the MIICF, the claimant can still receive the full 100% value of their compensation. Effectively the MIICF provides the remaining 35% share the claimant is due.
Reacting to the Minister’s announcement, David Fitzgerald, CEO of the MIBI said, “This is positive news for motorists and everyone involved in the motor insurance industry in this country. When this fund was established, it was always hoped that the need to collect contributions would not be prolonged. This rainy day fund has already helped Irish motorists impacted by a Danish insolvency and it is great to know that it exists for the good of Irish motorists and the sector at large. The MIBI is delighted we have been able to efficiently reach this threshold and that the fund has reached the point where Minister Chambers is in a position to exercise his discretion and remove the levy,” Mr. Fitzgerald concluded.