Minister for Business Heather Humphreys has warned insurers not to reject claims from businesses forced to close by "interpreting policies to their own advantage".
During the ongoing debate on the latest raft of emergency legislation provisions Ms Humphreys also advised people in need of loans not to engage with high-interest lenders.
She said “my advice is to keep the wolves from the door and go to your local credit union which you can trust”.
And she said all the schemes the Government was introducing “may not be perfect and they will be flawed” but were based on legislation that had to be drafted in days rather than the normal months.
Ms Humphreys quoted Dr Michael Ryan of the World Health Organisation that "when you're in a crisis speed trumps protection".
A number of TDs expressed concerns about insurance companies refusing to honour claims for loss of business.
Sinn Féin finance spokesman Pearse Doherty accused the insurance industry of "trying to wriggle out of the commitments they have made to policyholders" who had paid "an arm and a leg" for their premiums for years.
Fianna Fáil's Robert Troy said the Government and the Central Bank had to "keep on top" of insurance issues.
He said businesses took out legitimate cover and are entitled to compensation now. Mr Troy said “we cannot have protracted arguments over months and years”.
The Minister told TDs that “insurers should not attempt to reject claims on the basis of their interpreting policies to their own advantage”.
She said insurer should engage “honestly, fairly and professionally” to honour claims of businesses that had coverage for ceasing operations and closed either on advice or by Government direction.
She said it “amounts to the same thing” if the Government advises a business to close down or issues a direction because of a general notifiable infectious disease.
Ms Humphreys added that “insurers should not try to distinguish between these situations where there is a general infectious disease provision in a policy in order to avoid payment of claims”.
The Minister said the Central Bank would write to the insurance industry setting out how it expects insurance firms to handle the settlement of claims arising from the Covid-19 pandemic.
The regulator’s view is that all claims must be appropriately assessed by insurance firms and where there is cover in place that claims are accepted and paid.
