Insurer FBD Holdings has said it has put €22m aside to cover costs that may be incurred arising from all court cases involving pubs that are claiming cover for business interruption due to Covid-19 public health measures.
A hearing has been scheduled in the Commercial Court in October.
FBD said it remains strongly of the view that its business insurance policies do not provide cover for a pandemic of this nature.
"However, a precautionary reserve of €22m has been made to cover costs that may be incurred and will be included in claims costs in the half year financial results to June 30th 2020," the company said.
In a trading statement today, the company said that motor insurance refunds will cost the company about €7m.
FBD said it is in the process of refunding motor customers as a result of the reduced car usage during the coronavirus lockdown.
Refunds are also being offered to FBD's commercial customers whose businesses have been closed for the Employers Liability/Public Liability/Business Interruption elements of their cover for the closure period.
It said it expects commercial refunds to be an additional €7m.
In today's trading statement, FBD said the impact of these premium refunds on profits are being offset by a reduction in the frequency of injuries, damage and liability claims seen form the middle of March to date.
"Overall motor, liability and property claims experience has been benign and no significant weather events have occurred," it added.
FBD also said that its Gross Written Premium (GWP) trends were strong in the early part of 2020 but have been impacted by the deterioration in the economy due to the Covid-19 pandemic.
In the five months to the end of May, GWP is 3% lower than the same time last year - before accounting for Covid-19 related premium refunds to customers.
But it said its policy numbers have increased in the year to date by 1% and there has been strong retention of existing customers. This has been offset by reduced average premium due to competitive pressures and a reduction in sums insured driven by the deterioration in the economic environment.
In today's trading update, the company also said that it has decided not to proceed with the proposed dividend payment of 100 cent per share for its 2019 financial year.
"The board will keep the timing of the distribution of capital to shareholders under continuing review and is confident that capital can be returned when the uncertainty from Covid 19 has receded and the impact is more fully understood," it stated.
"The solvency of the group remains robust and is currently estimated at 178% even while continuing to deduct the 2019 dividend, treating it as foreseeable," it added.
FBD also said today that it will hold its AGM on July 31.
The AGM was originally scheduled to take place in May but was postponed due to Covid-19, recommendations from regulatory and public authorities, and consideration of the health and safety of shareholders, other attendees and employees.
The company said the format and attendance at the AGM will be determined in accordance with the latest public health advice.