As the EU aims to strengthen its competitiveness, insurance industry experts argue that Brussels must set clearer priorities. Instead of allocating scarce IT resources to additional regulatory frameworks, these should be directed towards future technologies, particularly in areas like artificial intelligence and cyber resilience, the GDV article emphasizes, further explaining: one such regulatory initiative under scrutiny is the Financial Data Access (FiDA) framework, which seeks to facilitate customer access to financial data and enable third-party providers to utilize it. However, the benefits for consumers remain uncertain, and industry representatives, including Jörg Asmussen, Managing Director of the German Insurance Association (GDV), express concern that the framework might do more harm than good.
“FiDA creates new bureaucracy with unclear benefits for consumers. This ties up resources, inhibits innovation, and ultimately makes products more expensive for customers,” warns Asmussen.
While the EU Commission hopes that FiDA will boost digital innovation in the financial sector, there is no proven demand for such a system, German insurers argue. At the same time, its implementation would require massive investments in IT infrastructure, data interfaces, and cybersecurity - diverting funds from other critical transformation projects.
Insurance companies are already managing significant regulatory burdens, such as compliance with the Digital Operational Resilience Act (DORA). Adding FiDA on top of these obligations could stretch resources even further, particularly for small and medium-sized enterprises (SMEs), which might struggle to keep up.
Another major concern is data security. By mandating the exchange of sensitive customer information via standardized interfaces, FiDA could increase the risk of cyberattacks and data misuse. Additionally, it may inadvertently strengthen non-European tech giants, as financial and insurance firms could become mere data suppliers for global technology companies without comparable obligations being imposed on these large players.
“We risk turning European financial and insurance firms into data providers for big tech, while they themselves have far fewer rights,” cautions Asmussen.
***
The legislative process for FiDA is ongoing, requiring negotiations between the European Commission, the European Parliament, and the EU Council through the trilogue process. Discussions are expected to conclude under the Danish Presidency in the second half of 2025.
As the EU strives for greater innovation and competitiveness, the debate over FiDA raises fundamental questions: Will it drive digital transformation, or will it become another costly regulatory burden?
Source: GDV
361 views
