Regulatory Alerts2025-12-04
Outcomes of Discussions on Margin Personalization
The Dutch Authority for the Financial Markets (AFM) reports on follow-up discussions with insurers regarding its April 2025 findings that half of the examined companies charged loyal customers higher premiums than new ones. Insurers acknowledged that higher margins for loyal customers are undesirable and have adjusted pricing or policies, citing causes such as lingering welcome discounts, new customer-only packages, and structural differences between closed and new book portfolios. The AFM expects insurers to continuously monitor margins, ensure balanced interest assessments when using pricing caps and floors, and explicitly justify any margin increases after the first two years of customer tenure.
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