Former RSA Ireland chief executive given 13-year industry ban

The Central Bank of Ireland has disqualified former RSA Insurance Ireland chief executive Philip Smith for 13 years after he admitted participating in a breach of financial services law linked to the under-reserving of large loss claims.

The regulator said it reprimanded Smith on 1 December 2025 and banned him from being concerned in the management of any regulated financial service provider, following findings that his actions contributed to RSA Insurance Ireland DAC failing to maintain adequate technical reserves.

The enforcement action related to a breach of Article 13(1)(a) of the European Communities Non-Life Insurance Framework Regulations 1994, which requires insurers to hold sufficient technical reserves to meet underwriting liabilities.

The enforcement outcome followed the long-running fallout from RSA’s Irish reserving issues, which previously triggered legal action from investors and regulatory sanctions.

RSA Insurance Ireland had previously been fined in 2018 after admitting that, as of 30 September 2013, it had a significant shortfall in its technical reserves due to the under-reserving of 17 large loss claims.

The Central Bank said Smith, while chief executive between 2009 and 2013, oversaw an undocumented process that prevented or delayed claims handlers from recording their recommended reserve estimates on the firm’s claims database.

As a result, technical reserves did not reflect the insurer’s estimated liabilities for specific severe claims, creating a risk that the firm might not have been able to meet policyholders’ claims.

The under-reserving led RSA Insurance Ireland to require a significant capital injection from RSA Insurance Group in 2013, including an uplift in reserves of more than €29m (£25.5m) to address the affected claims.

The Central Bank said its investigation did not find evidence of any actual loss to policyholders. However, it stressed that the failure to maintain adequate reserves posed a significant risk to policyholders and to confidence in the Irish insurance market.

A decade long dispute

The enforcement outcome also followed a long-running and highly public dispute between RSA and Smith after the reserving issues emerged in 2013. In January 2016, RSA confirmed that it had settled an unfair dismissal case with Smith, ending an appeal against a €1.25m (£1.10m) award made by Ireland’s Employment Appeals Tribunal the previous year.

Smith had claimed the insurer treated him unfairly and made him a scapegoat for the financial problems that hit its Irish business.

Colm Kincaid, deputy governor at the Central Bank of Ireland, said the actions of senior leaders were central to trust in financial services.

He said: “The actions of directors and senior executives shape the conduct and operating culture of the firms they lead – none more so than the chief executive. For consumers of financial products, including policyholders, to have trust in financial services, they need to be confident that their best interests will be secured.”

Kincaid added that the length of Smith’s disqualification reflected the seriousness of the breach and sent a clear deterrent message to other senior figures in regulated firms.

While the Central Bank considered that Smith’s conduct merited a €120,000 (£105,000) monetary penalty, it said it was unable to impose a fine due to statutory limits and Smith’s financial circumstances, which were assessed as part of the settlement process.

The case concluded a long-running enforcement investigation that began in 2014 and followed earlier sanctions against RSA Insurance Ireland and several former senior executives. The Central Bank said it would continue to use the full extent of its powers to pursue wrongdoing and hold individuals to account.