The Government should step in to support Irish companies insured by Independent Insurance - the British firm placed in liquidation last week - which may be facing collapse because they cannot afford to bear the cost of insurance claims themselves.
There were many Irish companies with extensive insurance cover from Independent, Mr Simon Coveney (FG) said. He was speaking to an adjournment motion in the Dail last night.
The company had been operating in the Republic for the last three years, but set up an Irish branch in Dublin last year. Its main business was employer's liability insurance and it insured a "number of very large companies" here, some of which were involved in the construction sector.
In recent days insurance brokers throughout the country had been "trying desperately" to reorganise insurance cover for their clients as Independent could no longer guarantee claims and payments.
The stricken company reported premium income of £30 million for this year in Ireland: "The serious threat to Irish companies arises because unlike companies in the UK, commercial customers here are not covered by the UK Policyholders' Protection Board" - if the insurer was liquidated or claims could not be met. This was because employers' liability insurance was not compulsory in the Republic.
Irish businesses and employments were faced with "a number of potentially serious consequences" as a result, Mr Coveney said. The first was the loss of some 30 to 50 jobs in Dublin. A second was the potential loss of cover and money to companies that had paid their "second half" premiums to Independent.
By far the most serious, however, was the fact that it was "by no means certain" whether claims submitted by or due to Irish companies would be honoured.
For example, a number of potentially large compensation claims involving construction companies due before the courts might now have to be borne by employers, he warned.
The Minister for Justice and Law Reform, Mr O'Donoghue, on behalf of the Tanaiste, Ms Harney - who was in Donegal - said that responsibility for Independent under EC Single Market rules, lay with the UK authorities. UK insolvency law treated all policy holders as unsecured creditors: "It will not be clear for some time to what extent the liquidators will be able to meet claims by creditors and policy holders. It appeared, however, that claims would not be met in full."