The way insurance is currently sold is about to change

15 September 2016 — Alexandru CIUNCAN, Adina TUDOR
EIOPA - The European Insurance and Occupational Pensions Authority published a Consultation Paper on draft Implementing Technical Standards (ITS) standardising the presentation format of the Insurance Product Information Document (IPID). The IPID will be provided to the customer prior to the conclusion of a non-life insurance contract in accordance with the provisions of the Insurance Distribution Directive (IDD).

The purpose of the IPID is to ensure that key information about non-life insurance products is presented to the customer in a standardised format they can use to understand the product offered, and compare between different products.

The key information to be included in the IPID is already determined by the IDD. The goal of this consultation is to collect public feedback about the presentation of the IPID, including on such features as its length, the use of icons and symbols, possible advantages of digital and paper formats, etc.

IDD provides that the IPID "shall contain the following information":
  • information about the type of insurance;
  • a summary of the insurance cover, including the main risks insured, the insured sum and, where applicable, the geographical scope and a summary of the excluded risks;
  • the means of payment of premiums and the duration of payments;
  • main exclusions where claims cannot be made;
  • obligations at the start of the contract;
  • obligations during the term of the contract;
  • obligations in the event that a claim is made;
  • the term of the contract including the start and end dates of the contract;
  • the means of terminating the contract".
In addition, IDD provides that the IPID "shall":
  • be a short and stand-alone document;
  • be presented and laid out in a way that is clear and easy to read, using characters of a readable size;
  • be no less comprehensible in the event that, having been originally produced in colour, it is printed or photocopied in black and white;
  • be written in the official languages, or in one of the official languages, used in the part of the Member State where the insurance product is offered or, if agreed by the consumer and the distributor, in another language;
  • be accurate and not misleading;
  • contain the title 'insurance product information document' at the top of the first page;
  • include a statement that complete pre-contractual and contractual information on the product is provided in other documents.
EIOPA's proposals for the IPID are based on two phases of consumer testing that were conducted among more than 3000 consumers in a representative sample of Member States.

The consultation will end on 24 October 2016. Comments submitted after the deadline or not submitted on the provided template cannot be processed.

The consultation paper and the template for comments, together with the consumer testing report can be viewed here​.

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