Regulatory Alerts2024-12-06
Order on Information Regarding Fees and Other Costs for Insurance Companies
Issued by the Danish Ministry of Industry, Business and Financial Affairs, this Order mandates that insurance companies clearly disclose fee structures and total pricing in marketing materials to consumers. It requires transparent reporting of organized discounts on company websites and establishes supervisory powers for the Danish Financial Supervisory Authority to enforce compliance. The regulation, which repeals the 2014 version, enters into force on January 1, 2025, with violations subject to fines and corporate criminal liability.
Order on Information Regarding Fees and Other Costs for Insurance Companies
Pursuant to Section 67, paragraph 3, and Section 316, paragraph 1, of Act No. 718 of 13 June 2023 on Insurance Business, the following is enacted:
Scope and Definitions
Section 1. This Order applies to Danish and foreign pension and life insurance companies and cross-border pension funds, as well as property insurance companies, which offer property and life insurance to consumers in this country, including through the establishment of branches.
Section 2. A consumer is understood to be a person who primarily acts outside their profession and who enters into a transaction or agreement with a business operator acting in the course of their business.
Paragraph 2. An insurance company is understood to be a pension and life insurance company, a cross-border pension fund, or a property insurance company.
Fee Information
Section 3. Insurance companies must clearly and prominently disclose on their company website the amount of the fees that the company imposes and collects from consumers.
Marketing
Section 4. If insurance companies provide information about the price of an insurance policy in marketing materials, the company must state the total price for the insurance that a consumer will be billed. The price consists of
- the insurance premium,
- the fees charged in connection with the establishment of the insurance, and
- statutory contributions and taxes that are billed to a consumer and collected directly from the consumer.
Paragraph 2. The information mentioned in paragraph 1 must be provided in a prominent manner.
Organized Discounts
Section 5. If an insurance company provides organized discounts or other special benefits to members of associations, organizations, or other specific groups of persons, including employees of specific companies, it must clearly state on the company's website which groups receive organized discounts, as well as the size thereof.
Paragraph 2. The provision in paragraph 1 does not apply to discounts or other special benefits given as part of an employment relationship between the discount provider and the discount recipient.
Supervision and Penal Provisions
Section 6. The Danish Financial Supervisory Authority may, pursuant to Section 275 of the Act on Insurance Business, issue orders to rectify matters that are in conflict with Sections 3, 4, and Section 5, paragraph 1.
Section 7. Violation of the provisions in Sections 3, 4, and Section 5, paragraph 1, is punishable by fine, unless a higher penalty is incurred under other legislation.
Paragraph 2. A fine shall be imposed on anyone who fails to comply with an order pursuant to Section 6.
Paragraph 3. Companies and other legal persons may be subject to criminal liability pursuant to the rules in Chapter 5 of the Penal Code.
Entry into Force
Section 8. This Order enters into force on 1 January 2025.
Paragraph 2. Order No. 44 of 19 January 2014 on information regarding fees and other costs for insurance companies is repealed.
Ministry of Industry, Business and Financial Affairs, 6 December 2024
Morten Bødskov / Julie Sonne
Official Gazette A Published 14 December 2024 6 December 2024. No. 1535. Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, file no. 24-019432 CQ003039