Insurance Contracts CP - Law Reform Commission

uilt upon is ―that gambling is kept free of crime.‖ 195 The Commission expects that the ―complex and
comprehensive legislation‖ 196 that may arise in the future may not address the insurance/gambling
dichotomy directly. In the most recent discussion document the Department of Justice and Equality
observe that any new regulatory architecture for gambling will pursue three central objectives:
that young people and the vulnerable are protected;
that gambling should in all respects be fairly and openly conducted
that gambling is kept free from crime.
2.112 It is a central point in the discussion document to note that the emphasis is on better
regulation, not deregulation. This observation, in relation to gambling policy, also holds true in relation to
the Commission‘s recommendations in relation to reform of the insurable interest rules. It is of interest to
note that many of the central recommendations in relation to changing the gambling regulation
architecture – the creation of a regulatory authority, licensing of operators with strict compliance rules, a
power vested in the Minister to fine-tune rules by way of secondary legislation – resemble the insurance
regulation landscape as it currently exists. Because it is to be a feature of gambling reform that
definitions of gambling will be written into Irish law for the first time 197 and the statutory rules preventing
the enforcement of gambling contracts will not be continued, 198 a co-ordinated but not integrated
approach to insurance and gambling regulation will be required. Commercial and cultural developments
such as the expansion of betting exchanges and spread betting illustrate that certain types of risk hedging
or avoidance will straddle the boundary between gaming regulation and insurance/financial services
authorisation. 199
2.113 Currently, spread betting and Contracts for Difference products (CFDs) are regulated by the
Central Bank of Ireland, and press reports in 2011 200 indicate that compliance with regulatory
requirements in Ireland are not being fully met by the 29 companies that are approved to offer such
products within the State. These matters are seen as consumer protection matters rather than moral
hazard issues and attest to the fact that any insurable interest requirement, as a legislative proxy for
counteracting socially undesirable contracts of speculation, has no part to play in modern Irish law.
195
196
197
198
199
200
Response of the Minister to a Parliamentary Question, October 7, 2010.
Ibid.
Options for Regulating Gambling (December 2010).
Paras 2.8 and 3.8.
Para 3.34. See Devaney [2009] CLP 28.
Eg. ―Spread-bet firms may face regulator enforcement‖ The Irish Times 16 June 2011. Regulation by means
of bookmakers‘ licences and the Markets in Financial Instruments Directive (2004/39/EC) could be described
as patchy at best, with consumer protection being limited to financial spread betting.
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