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EIOPA annual report on sanctions and other measures related to the Insurance Distribution Directive (IDD) for the year 2020, in Belgium and the Grand Duchy of Luxembourg

By January 19, 2022 No Comments
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On 21 December, the European Insurance and Occupational Pensions Authority (‘EIOPA’) published its annual report on administrative penalties and other measures taken pursuant to directive (EU 2016/97) on insurance distribution (‘IDD’). ») 1 .

This report provides an assessment of the sanctions imposed by the competent national authorities pursuant to IDD. Thus, it should be noted that 1,942 sanctions or measures have been taken within the 17 Member States with, as regards financial sanctions,total amount of € 793,571.

During the year 2020, as in the previous period, the majority of sanctions (more than 80%) taken within the Member States concern non-compliance with the professional and organisational requirements ofArticle 10 of the IDD,aimed essentially at either the formalities to be complied with for access to and maintenance of/in a profession in the insurance sector, or the obligation in terms of training and development of insurance intermediaries and insurance intermediaries. reinsurance.

Theadministrative fine is the most common sanction (more than 50% of cases), followed by the withdrawal of registration (about 25% of cases).

1. Analysis of the sanctions and measures taken in Belgium for the year 2020:

1.1. The legal provisions violated:

For the year 2020, in addition to the violation of Article 3 (registration of insurance and reinsurance intermediaries (including as an accessory) and Article 10 (professional and organizational requirements) of IDD, the sanctions and measures in Belgium originate from a violation of the articles:

– 15, aiming at the establishment of an effective procedure for the extra-judicial settlement of disputes;
– 16, aimed at limiting the use of intermediaries by insurance and reinsurance undertakings and intermediaries;
– 17(2), aimed at providing correct, clear and non-misleading information to customers and potential customers, and at ensuring that advertisements are clearly identifiable;
– 20(1) and (2), aimed at providing advice and sales practices andadapting them according to the complexity of the product;
– 23(1)(b) concerning the clear, precise and comprehensible nature of the information provided to customers under Articles 18, 19, 20 and 29 of IDD;
– 30(1), (2) and (5), relating to advice on an insurance-based investment product , verification of the knowledge of the client /potential client, and the information of the latter;
– 33(1)(b), relating to offences, sanctions and other measures.

1.2. What sanctions or measures have been taken?

Over the year 2020, 4 administrative financial penalties were imposed for a total of € 302,500: One for violation ofArticle 3(1) in the amount of € 2,500,two for violation ofArticle 16,in the amount of € 75,000 each, and finally one forArticle 33(1)(b),in the amount of € 150,000 , the latter fine resulting from a settlement originating in the fact that an insurance undertaking collaborated with an insurance intermediary not registered with the FSMA.

For the remainder, the sanctions or measures taken pursuant to IDD but also to Commission Delegated Regulation (EU) 2017/2359 of 21 September 2017, supplementing IDD as regards the information requirements and conduct of business rules applicable to the distribution of insurance-based investment products, consist of an injunction to cease a particular conduct (111), a withdrawal of registration (40), or other administrativesanctions or measures (1), the latter not being specified in the report.

2. Analysis of the sanctions and measures taken in the Grand Duchy of Luxembourg for the year 2020:

In the Grand Duchy of Luxembourg, no sanctions or measures were enacted in the course of 2020.