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Extracts from the Irish Parliament 1998 Debates on the Office of the Insurance Ombudsman of Ireland


Irish Senate (The Upper House) Debate on the Office of the Insurance Ombudsman

(Thursday, 23rd April 1998)


Dr. Mary Henry (Senator):

I attended the launch of the report of the first five years of the [Insurance Ombudsman] scheme at the end of January.

At that time the Ombudsman [Paulyn Marrinan-Quinn] announced that she was resigning from her office.....

..... on 5th February 1998, a member of the Council of the Insurance Ombudsman of Ireland, Mr. Bill McLaughlin, resigned and issued a public letter making known the reasons for his resignation. Serious allegations as to the reasons the Ombudsman had resigned were made in this letter.

Mr. McLaughlin said: "It is a worldwide truism that 'the insurance industry has fine disregard for its customers; its prime concern is to sell, regardless of the consequences' and this perception holds equally in Ireland as elsewhere....

Many people know Paulyn's steadfast stance against this common perception, be it real or imaginary, proclaiming her independent role to insurer and insured alike, but few will have heard of her refusal behind the scenes to compromise the high standards she has so rightly interpreted for her Office, despite extreme pressure."

Paulyn's decision to stand down was made following unremitting coercion. From the beginning, she has had to fend for the process and the scheme against its creators....

Ever since the scheme was conceived, the Office it embodies has been under attack. The initial Terms of Reference, submitted by the Irish Insurance Federation, tried to limit the Ombudsman's jurisdiction to seeing that the particular complaints procedure had been adhered to; Government gave its grudging and conditional approval to the scheme only when  these terms were much expanded to include the investigation and decision on a complaint, as at present...

To continue from Mr. McLaughlin's letter:

"Paulyn has resisted this unrelenting bullying from the moment she took up her Office. It is a classic case where initially trivial points are made, becoming ever greater both in size and in the pressure behind them. The classic types of bully are featured on the Council and the Board which are in openly admitted collusion; their purpose being to control and subjugate, their methods thriving on secrecy.

Council unanimously decided at its meeting on 10th July 1997 not to renew Paulyn's contract from 31st August 1997. I and the two industry members were not at that meeting and, despite repeated requests, I have been provided with no reason for that decision, with which I disagreed.....

Apart from the control of the Council by the Board already noted (in contravention of the very concept of their separate identities) and the control of the Ombudsman sought to be exercised by the Board (by withholding funds), there included the following :–


infringement of the Ombudsman's independence in attempting to influence the content of her Annual Reports;


further infringement of the Ombudsman's independence in advertising for, selecting and insisting on an extra staff member contrary to the Ombudsman's wishes and outside her management;


and a review of the Terms of Reference, memorandum and articles of association so that the Council (effectively the Board) would have a formal schedule of matters reserved to it so that the control of the company (The Insurance Ombudsman of Ireland Ltd.) is firmly in its hands."

Mr. McLaughlin concludes by saying that, having made his concerns about the problem with the scheme repeatedly known to the Council, the Board, the Insurance Federation and to individuals within the Insurance Industry — to no avail, he had no option but to resign.



Irish Dáil (The Lower House) Debate on the Office of the Insurance Ombudsman

(Tuesday, 9th June 1998)

Mr. Pat Rabbitte (Dáil Deputy): ..... There are famously two problems associated with the discharge of an Ombudsman's duties, whether state or private sector. The first is censorship and the second is funding. The role of the Ombudsman is undermined if he or she is oppressed by either problem. Hence the preference in many quarters for a statutory based scheme....

After five years, it is apparent that the Insurance Ombudsman of Ireland has been beset by the two problems to which I referred, censorship and funding. In this regard, the public letter from Mr. Bill McLoughlin, who felt compelled to resign from the Council, is revealing.

Mr. McLoughlin wrote that “it took four years to overcome persistent internal resistance to house the scheme properly”.

He continued: “Despite the obvious savings to the [Insurance] Industry, she [the Ombudsman] has had to battle constantly for funds to be paid on time”....

More remarkably, Mr. McLoughlin alleges that Ms Marrinan-Quinn “has had to resist unrelenting bullying since the moment she took up her Office”. It is also claimed that the Council sought to approve and alter the Ombudsman's Annual Report....

Across the water [in the united Kingdom], it is clearly established that other problems are confronting the trusting consumer, such as mis-selling....

It [the Insurance Industry] cannot be allowed to believe that in 1998 it will get away with a merely decorative or tame Ombudsman who will be prepared to function within what the Industry regards as expedient parameters.   ...... in Ms Marrinan-Quinn, the consumer and the Industry has an exceptional Ombudsman who has asserted her independence in the face of bullying and who has established a splendid reputation for the Office.


Mr. Noel Treacy (Minister of State at the Department of Enterprise, Trade and Employment): ..... I met the insurance Ombudsman personally last December [1997] and arising from the matters then discussed, I sought a meeting with the Council. At that meeting with the chairman and deputy chairman, I conveyed our concern that the Council should be seen to act as an effective buffer between the Board, representing the participating insurance companies, and the Ombudsman, to ensure that the Ombudsman had unfettered autonomy in discharging the responsibilities of this very important Office, in accordance with the agreed Terms of Reference.

The Council representatives assured me that this was the case.

Mr. Pat Rabbitte: It is not the case.


Mr. Noel Treacy: They [the Council] in turn undertook to reflect on particular matters which I raised with them. I intend to have further discussions with the Council later this year.

The Office of the Insurance Ombudsman will continue to operate and it will continue to prosper. If the Deputy needs tangible proof of this I would simply point out that advertisements in respect of the forthcoming vacancy created by Ms Marrinan-Quinn's departure from the Office of the Insurance Ombudsman of Ireland were placed in the national papers.

Mr. Rabbitte: They were not inserted with her [Ms Marrinan-Quinn's] agreement.


Mr. Treacy: Quite rightly, the job specification made it amply clear that Ms Marrinan-Quinn's successor would require a detailed knowledge of Irish insurance law and an intuitive understanding of dispute resolution mechanisms and practices.

Mr. Rabbitte: And an ability to cow down to the [Insurance] Industry and do nothing about it.


Mr. Treacy: I am sure all interested parties will do their utmost to ensure that the transition from Ms Marrinan-Quinn's tenure as Insurance Ombudsman of Ireland to that of her successor will be made as seamless as possible. On my own behalf, on behalf of the Government and the Department, I sincerely thank Ms Marrinan-Quinn for her outstanding contribution as the country's first ever insurance ombudsman.

Mr. Rabbitte: Platitudes!



Senate (The Upper House) Debate on the Office of the Insurance Ombudsman

(Wednesday, 17th June 1998)

Mr. Noel Treacy (Minister of State at the Department of Enterprise, Trade and Employment): ..... As a device to ensure the independence of the Ombudsman, the operation of the service is divided into three component parts. I will for the benefit of Senators explain again the significance of those components. The first part is a Board, comprising executives elected from those Insurers taking part in the scheme. The second is a Council, made up of nominees from within and outside the Insurance Industry. The Council recruits and appoints the Ombudsman subject to the approval of the Board.

Mr. Paul Coghlan (Senator): ..... The very title 'Ombudsman' implies probity and independence. We seem to be witnessing a big, bad mannered bully trying to nobble the Office…

On resigning, one member of the Insurance Council, Mr. Bill McLoughlin, wrote that Ms Marrinan Quinn had to resist unrelenting bullying from the moment she took office. The Council apparently sought to approve and alter the Ombudsman's Annual Report and that is absolutely unacceptable.

Here we are, a reliable little democracy adhering to the best ethical standards, but the giants of the Insurance Industry have tried to perpetuate an appalling conflict of interest...... This smacks of them wanting a cosy cartel arrangement enshrined in procedure.

…The Insurance Ombudsman said recently in a statement that the interface between the Office and its Board and Council requires urgent examination…..

The Insurance Ombudsman stated that [not] only do the structures not meet international best practice standards, but some Council interventions amount to censorship of the Insurance Ombudsman's capacity to inform the consumer of their rights and how they may be vindicated.

The Insurance Ombudsman continued that there is a clear dichotomy between the Ombudsman's obligations to use the Annual Report of the Office as a public interest document and a view intimated by the Board / Council that it is a marketing tool.....


Mr. David Norris (Senator): ..... I want to turn to the last Report published by the Insurance Ombudsman, Ms Paulyn Marrinan Quinn....

She said nothing until her position was made absolutely intolerable by the Insurance Industry.

She remained silent even when one of her senior personnel, Mr. Bill McLoughlin, was forced to resign by the chicanery that was going on in the Insurance Industry.

Let us be honest. The Insurance Industry has been consistently attempting to interfere in the independence of the Office of the Insurance Ombudsman and to vitiate every principle that underlines the Office and its function.....

Many of us feel it is time for the Office of the Insurance Ombudsman be taken away from an Insurance Industry that has shown itself totally incapable and unworthy of operating a voluntary scheme.

We must establish a statutory Insurance Ombudsman.

We can no longer tolerate a situation where there is corrupt interference. We have seen that and have evidence of it.

Over the past few weeks a distinguished, balanced and responsible person like the Insurance Ombudsman has complained of a whole series of vitiating factors — interference, attempts to influence the Report and the withholding of money. She was challenged on this and was able to give facts, figures, dates and sums of money. She was forced into the embarrassing and humiliating situation where she was called in by the bank.

The Insurance Companies have shown that they are not fit to be trusted with this Office.....