Insurance Mediation Directive Anna Kadar Insurance and Pensions

Insurance Mediation Directive Anna Kadar Insurance and Pensions Unit DG Internal Market and Services European Commission 20/05/2021

The Insurance Mediation Directive (IMD 1) and its recast (IMD 2) • IMD 1 (2002): removing barriers to free movement of insurance agents and brokers, requirements on insurance intermediaries selling insurance products (who can sell? ) • IMD 2 (proposal 2012): extends IMD 1 to all sellers of insurance products (including insurance companies) and extends IMD 1 to all products (including life insurance with investment elements) (what can the intermediary sell? ). • Main objective: consumer protection 20/05/2021

IMD and its links to financial services • Mi. FID II (Markets in financial instruments Directive) regulates the sale of insurance-based investment products via an amendment to IMD 1 • Definition of insurance PRIPs (Packaged Retail Invesment Products) • Tying and bundling of products (i. e. mortgage and payment protection or life insurance) (MCD – Mortgage Credit Directive) • Out-of-court settlement of disputes (ADR – Alternative Dispute Resolution) 20/05/2021

Consumer protection in IMD • Authorisation / registration requirements (business card) • Insurance comparison websites included in the scope • Inclusion of ancillary sellers (travel agents, car rentals) as well as insurance companies • Fair, clear and not misleading information provision • Demands and needs of customer • Professional qualifications requirements (professional training to match the insurance product) • Remuneration disclosure requirements (nature, source, amount) + insurance company employees' variable remuneration (bonus) 20/05/2021

Insurance products with investment elements • Additional consumer protection requirements for insurance-based investment products • Mi. FID II rules on investor protection • Amending IMD 1 • Management of conflicts of interests between the insurance intermediary/employee and the customer • Acting in the best interest of the consumer • Ban on commissions for independent advice (or MS option to do so) • Consumer protection as regards cross-selling practices • Consumer protection as regards out of court settlement of disputes 20/05/2021

Timing of IMD 2 • EP plenary vote took place on 25 February 2014 (not on legislative resolution) • Incoming Parliament? • No Council position yet (expected by the summer) • IMD 2 expected to be finalised by end 2014 20/05/2021

Thank you for your attention. Questions? Email: anna. kadar@ec. europa. eu 20/05/2021