Insurance products in EU set for new disclosure rules

The European Commission laid down new rules last week for an Insurance Product Information Document (IPID), which will have to accompany all non-life insurance policies in Europe from 2018.

The new rules will allow consumers to have all information necessary to make an informed decision when buying insurance products, such as car, travel or house insurance, says the EU executive.

This type of key information document already exists for life insurance policy and other investment products under the Regulation on Key Information Documents for Packaged Retail and Insurancebased Investment Products (PRIIPs).

The implementing rules adopted by Brussels, in the form of an implementing technical standard, stem from the Insurance Distribution Directive which will need to be applied in the EU Member States in February 2018.

The IDD aims to create a level playing field between insurance distributors across the European Union. It will guarantee that customers get the same standards of choice and service when buying insurance, regardless of the Member State in which the insurance was bought.

The Commission says the Directive will ensure appropriate standards of transparency by setting out the necessary information to be provided to consumers before they sign up to an insurance contract.

Further implementing rules for the IDD are set to be adopted in the coming weeks. These will cover product oversight and governance (for all insurance products) and various conduct of business rules(for life insurance products).

These draft rules are currently under public consultation on the Commission's Better Regulation portal, until today.