In Ireland, 38% of financial assets are held in cash and deposits, above the EU average of 30%. Irish households prefer to invest through insurance and pension products, with 46% of the population indirectly investing into the capital markets via these instruments – well above the EU average of 26% for this category of assets. But there is a need to go beyond.

Europe’s competitiveness challenge requires an urgent action by both our European and national policymakers. The Draghi report warned that the US–EU GDP gap doubled over two decades. More than 70% of this gap is driven by weaker productivity in the EU. At the heart of the problem is Europe’s inability to finance innovation at scale, a structural flaw linked to the absence of a genuine Savings & Investment Union. Without deeper capital markets, growth, innovation and competitiveness will remain constrained. The findings of the CBI research highlights that in Ireland, there are several barriers which deter households from investing more.

While most investors are primarily motivated to secure retirement income, many still perceive participation in capital markers as an exclusive opportunity for wealthy people.

Significant barriers remain for those who do not invest. Irish households tend to have a moderate risk appetite, and fear of losing money is a key reason for non-participation of retail investors in the capital market. Additionally, 48% of the surveyed consumers cite lack of knowledge as a reason for not investing. Complexity and an overwhelming range of choices are also seen as obstacles. The CBI’s research shows that investors are more likely to be male, aged between 35-54, in employment, with higher gross household income, a higher level of educational and living in Greater Dublin. Beyond these challenges and barriers to retail investor participation, the report also points to key factors that can foster a stronger investment culture.

Building a strong investment culture requires an ecosystem where key elements work together. The CBI points to product diversity, accessible advice and information, and robust investor protection as essential prerequisites for stronger retail investors participation. Policy measures on taxation and pensions, coupled with high income and financial literacy, are equally critical factors for improving retail investments. European experience like the Swedish one shows that when these factors align, retail investors’ participation increases.

Irish insurers are well  positioned to provide wider access to capital markets through their product offerings, including the planned introduction of an Irish savings and investment account.

In the context of the Savings & Investment Union’s Agenda, the European Commission has recently published a recommendation to Member States for Savings and Investment Accounts (SIA) for retail investors. The SIA presents an important opportunity to consider how a low-cost, easily accessible investment product might enhance the options available to consumers. The Government has committed to consider this recommendation to create an Irish SIA and Irish insurers are ready to play a role and support the Government in the design and introduction of a SIA in the Irish market.

SIAs should aim to offer consumers simple access to diverse financial instruments and foster competition and innovation for the benefit of consumers. Insurance Ireland supports the initiative but highlights concerns, particularly the possibility that insurers are excluded as eligible providers. Insurers must be explicitly recognised as eligible SIA providers. Life insurers bring decades of expertise in long-term savings, operate under strong EU regulatory frameworks (Solvency II and IDD) and already offer tax-efficient products across Member States. Their exclusion risks narrowing consumer choice and stifling innovation in the savings and investments market.

For the success of this Irish SIA, tax treatment must be aligned across savings products to ensure fairness and consumer choice. In Ireland, life insurance savings face a 38% exit tax. Significantly higher than the 33% on bank deposits, plus a 1% levy. Removing the life assurance levy and harmonising tax rates is essential to create a level playing field for SIAs.

The CBI’s analysis is a wake-up call: Ireland needs a more mature, inclusive and competitive savings and investment ecosystem. By leveraging on the Irish insurance industry expertise and experience, simplifying rules, and focusing on practical solutions, we can help Irish households make the most of their savings while safeguarding consumer protection. The ongoing discussions on the EU Savings and Investment Union Agenda, as well as the setting of a national Irish SIA are an opportunity to turn these insights into action.