While Europe’s insurance industry waits to learn whether a proposed seven-month postponement of the long-awaited Insurance Distribution Directive’s implementation deadline will go ahead, the UK Treasury has published a response to its recent consultation on how it has proposed to implement the legislation in Britain.
The 15-page response to the Transposition of the Insurance Distribution Directive Consultation begins by noting that the IDD, which had been due to come into force on 23 February, may be pushed back to 1 October.
As reported, that postponement, which is expected to be adopted, followed a recommendation by the European Parliament and 16 member states that the date be delayed, citing what it said was an apparent need by many industry players to have more time to prepare. Insurance industry and government officials across the bloc are waiting for the European Parliament and Council to agree, and to confirm the new application date before it can happen.
Although it has been years in the development, industry officials have said more time is still needed for companies to prepare for its regulations, arguing that there wasn’t sufficient time given them between the issuance of the final text of the regulations, and the intended commencement date.
The consultation document also acknowledges that as a result of the UK’s June, 2016, there may ultimately be questions as to whether UK insurers will still be subject to the IDD’s provisions once the UK has left, but adds that “until exit negotiations are concluded, the UK remains a full member of the European Union, and all the rights and obligations of EU membership remain in force”.
The IDD was conceived to provide a framework aimed at regulating the way insurance products are sold throughout Europe, including across national borders. It sets out the information that consumers should receive before they sign an insurance contract, while also imposing conduct of business and transparency rules on distributors.
To read and download the response to the UK government’s consultation on its transposition plans, click here.