Regulatory Alerts2018-03-21
Guidelines under the Insurance Distribution Directive relating to insurance-based investment products structured in a way that makes it difficult for consumers to understand the risks involved
EIOPA issued these Guidelines under the Insurance Distribution Directive to establish assessment criteria for insurance-based investment products structured in ways that may obscure risks from consumers. The Guidelines require insurance intermediaries and undertakings to evaluate contractual features—including investment exposure, redemption mechanisms, maturity/death benefit calculations, cost structures, and beneficiary clauses—to determine whether products qualify for execution-only sales without suitability or appropriateness tests. National competent authorities must align their supervisory frameworks with these criteria and report compliance to EIOPA within two months of publication.
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