EU Directive on insurance mediation
EU policy is aimed at achieving a market throughout the EU for insurance intermediaries.
The current EU Directive 2002/92 on insurance mediation aims to ensure:
- professionalism and competence among insurance intermediaries
- protection of customers’ interests
- that individuals / companies providing insurance or reinsurance mediation are registered in their home EU country (which allows them to do business elsewhere in the EU)
- Respect for minimum professional requirements such as:
- appropriate knowledge and ability
- good repute
- professional indemnity insurance or other comparable guarantee
- sufficient financial capacity to protect customers.
- clear explanations for customers on the advice given
- involvement of national financial authorities and other bodies in the registration process
- easy public access to details of registered insurance and reinsurance intermediaries
- appropriate and effective alternative dispute resolution procedures, in particular via the FIN-NET network.
- Protocol on cooperation between national authorities for exchanges of information and notifications under the insurance mediation directive.
- List of competent authorities responsible for ensuring the implementation of the insurance mediation directive and list of EU countries wishing to be notified by other countries’ competent authorities when (re)insurance intermediaries want to carry on business in their territory.
- Financial Services Action Plan on the need for a truly integrated retail market.
The Directive is applied differently between EU countries, meaning that:
- EU insurance markets are fragmented
- there are significant inconsistencies, in particular regarding the information requirements imposed on sellers of insurance products
- customers are more likely to misunderstand the risks, costs and features of insurance products.
The collapse in consumer confidence during the financial crisis has also given new prominence to consumer protection issues.
On 3 July 2012 the Commission adopted a proposal for a revision of the Insurance Mediation Directive (IMD 2). The goal of the Commission’s proposal is to upgrade consumer protection in the insurance sector by creating common standards across insurance sales and ensuring proper advice
Public consultation (autumn 2010) to collect views from all stakeholders on how to address the main weaknesses in the current Directive.
- Public hearing on the revision of the Insurance Mediation Directive (December 2010 – Brussels):
- Study on the impact of revising the Insurance Mediation Directive by Price Waterhouse Coopers – Luxembourg (ETD/2007/IM/B2/51) – Final Report