COVID-19 (Coronavirus): what impacts on insurance intermediaries in Europe ?

CGPA Europe provides an overview of the measures taken by various European Union Member States to deal with the COVID-19 (Coronavirus) pandemic, which have an impact on the insurance sector.

EIOPA issues a series of recommendations 

The Euro­pean Insu­rance and Occu­pa­tio­nal Pen­sions Autho­ri­ty (EIOPA) expres­sed in a press release its recom­men­da­tions on divi­dend dis­tri­bu­tion and variable remu­ne­ra­tion poli­cies. Consi­de­ring the uncer­tain­ty about the eco­no­mic impact of the pan­de­mic, EIOPA urges that at the cur­rent junc­ture (re)insurers tem­po­ra­ri­ly sus­pend all dis­cre­tio­na­ry divi­dend dis­tri­bu­tions and share buy backs aimed at remu­ne­ra­ting sha­re­hol­ders. This pru­dent approach should also be appli­cable to the variable remu­ne­ra­tion policies.

EIOPA under­lines the impor­tance of main­tai­ning the ser­vices to poli­cy­hol­ders. In this sense, insu­rance com­pa­nies should be rea­dy to imple­ment the neces­sa­ry mea­sures to ensure busi­ness conti­nui­ty. Fur­ther­more, EIOPA high­lightes that, in order to offer ope­ra­tio­nal relief in reac­tion to coro­na­vi­rus, natio­nal com­petent autho­ri­ties (NCAs) should be flexible regar­ding the timing of super­vi­so­ry repor­ting and public dis­clo­sure regar­ding end 2019. EIOPA will coor­di­nate the spe­ci­fics of the approach. In order to ensure that the prio­ri­ties are consistent with the cur­rent situa­tion, EIOPA publi­shed a recom­men­da­tion to fos­ter conver­gence and consistent super­vi­so­ry approaches across Mem­ber States when pro­vi­ding flexi­bi­li­ty for super­vi­so­ry repor­ting and public dis­clo­sure of insu­rance and rein­su­rance undertakings.

Euro­pean Data Pro­tec­tion Board (EDPB): “Data pro­tec­tion and public health go hand in hand” 

During its 23rd ple­na­ry ses­sion, the Euro­pean Data Pro­tec­tion Board (EDPB) adop­ted gui­de­lines on the pro­ces­sing of health data for research pur­poses in the context of the COVID-19 out­break. Indeed, due to the COVID-19 pan­de­mic, there are cur­rent­ly great scien­ti­fic research efforts in the fight against the SARS-CoV‑2 in order to pro­duce research results as fast as pos­sible. At the same time, legal ques­tions concer­ning the use of health data pur­suant to Article 4 (15) GDPR for such research pur­poses keep ari­sing. These gui­de­lines aim to shed light on the most urgent of these ques­tions such as the legal basis, the imple­men­ta­tion of ade­quate safe­guards for such pro­ces­sing of health data and the exer­cise of the data sub­ject rights. 

The EDPB also adop­ted gui­de­lines on geo­lo­ca­tion and other tra­cing tools in the context of the COVID-19 out­break. These gui­de­lines cla­ri­fy the condi­tions and prin­ciples for the pro­por­tio­nate use of loca­tion data and contact tra­cing tools, for two spe­ci­fic purposes :

  • Using loca­tion data to sup­port the res­ponse to the pan­de­mic by model­ling the spread of the virus so as to assess the ove­rall effec­ti­ve­ness of confi­ne­ment measures ; 
  • Contact tra­cing, which aims to noti­fy indi­vi­duals of the fact that they have been in close proxi­mi­ty of someone who is even­tual­ly confir­med to be a car­rier of the virus, in order to break the conta­mi­na­tion chains as ear­ly as possible.

The EDPB has taken posi­tion on the fact that the use of contact tra­cing appli­ca­tions should be volun­ta­ry and should not rely on tra­cing indi­vi­dual move­ments but rather on proxi­mi­ty infor­ma­tion regar­ding users.

ITALY — Ita­lian com­pa­nies stand out for their dynamism

EMF­Group, an Ita­lian mar­ke­ting consul­tan­cy firm, has ana­ly­sed seve­ral insu­rance pro­duct offe­rings crea­ted by insu­rance com­pa­nies and banks as a result of the pan­de­mic, and in par­ti­cu­lar their tech­ni­cal and ser­vice per­for­mance. Here are the pre­do­mi­nant orien­ta­tions of these offers : exten­sion of the cove­rage alrea­dy pro­vi­ded for in the poli­cies ; indem­ni­ty not only in the event of hos­pi­ta­li­sa­tion, but also during iso­la­tion at home (qua­ran­tine), without the appli­ca­tion of deduc­tibles fol­lo­wing a posi­tive diag­no­sis of conta­gion. Mar­cel­la Fra­ti pre­sident of EMF­group said that “Insu­rance com­pa­nies have inno­va­ted by pro­po­sing not only inter­ven­tions in favour of agents, but also actions for the direct pro­tec­tion of their clients, often consi­de­ra­bly broa­de­ning the com­po­nents of the reim­bur­se­ment or ser­vice offe­red. This demons­trates consi­de­rable dyna­mism and a great capa­ci­ty to respond to mar­ket deve­lop­ments on the part of the entire sector”.


GREECE — The nego­tia­tion of Greek insu­rance intermediaries

The Greek asso­cia­tion of insu­rance inter­me­dia­ries has laun­ched a dis­cus­sion with the govern­ment, achie­ving some results :

  • Inclu­sion of the insu­rance bro­ke­rage indus­try among the sec­tors tar­ge­ted by eco­no­mic sup­port interventions ;
  • Pos­si­bi­li­ty of redu­cing month­ly social secu­ri­ty contri­bu­tions by 25% for the entire dura­tion of the crisis ;
  • Pos­si­bi­li­ty of redu­cing office rents by 40%;
  • The insu­rance com­pa­nies have accep­ted many requests from inter­me­dia­ries, for example the exten­sion of the can­cel­la­tion condi­tions of insu­rance poli­cies for various sectors. 

The association’s list of requests also includes :

  • The imple­men­ta­tion of mea­sures (with the par­ti­ci­pa­tion of the State) aimed at redu­cing wor­king time ;
  • Tax exemp­tion on life and real estate premiums.

UK – Gui­dance on COVID-19 Busi­ness Inter­rup­tion Claims and increase in car insu­rance premiums

New FCA Gui­dance on COVID-19 Busi­ness Inter­rup­tion Claims

The Finan­cial Conduct Autho­ri­ty (FCA), the finan­cial regu­la­to­ry autho­ri­ty in the Uni­ted King­dom, high­ligh­ted in a “Dear CEO” let­ter that there are poli­cies where it is clear that the firm has an obli­ga­tion to pay out on a poli­cy. For these poli­cies, it is impor­tant that claims are asses­sed and set­tled qui­ck­ly. A key objec­tive of the FCA is to ensure that finan­cial pres­sures on poli­cy­hol­ders are not exa­cer­ba­ted by slow pay­ment ; rather, such claims should be paid as soon as possible. 

“If there are rea­so­nable grounds to pay part of the claim but not to make the pay­ment of such claims in full, we would like you and your Board to adopt an approach of making an inter­im pay­ment. Many firms are alrea­dy doing this” recom­men­ded the Authority.

UK motor pre­miums conti­nue to rise amid­st COVID-19 pandemic 

Amid­st the cur­rent public health cri­sis and glo­bal pan­de­mic, pre­miums conti­nue to acce­le­rate in the motor insu­rance mar­ket, with prices rising 2.8% in the last 3 months, total­ling a 5.5% increase in the last year, accor­ding to the latest figures from data insight spe­cia­list, Consu­mer Intelligence.

FRANCE — A gene­ral mobi­li­sa­tion in the insu­rance industry

“A new insu­rance-type sys­tem, capable of cove­ring large-scale health disasters” 

Flo­rence Lust­man, pre­sident of the Fédé­ra­tion Fran­çaise de l’As­su­rance (FFA) sta­ted that : “Tra­di­tio­nal pro­tec­tion mecha­nisms are not suf­fi­cient to deal with such crises. Insu­rance can­not take the place of the State. Never­the­less, it can shoul­der its res­pon­si­bi­li­ties in accor­dance with its capa­bi­li­ties – and indeed it is alrea­dy doing so – and put for­ward pro­po­sals for the future. One thing we can do now to pre­pare for future crises of this type is to think about the basis of an insu­rance-type sys­tem that would be able to cover large-scale health disasters. 

We must not, howe­ver, make the mis­take of thin­king that insu­rers can cover such events on their own. The sys­tem must be based on a part­ner­ship with the State. The Fédé­ra­tion Fran­çaise de l’Assurance has deci­ded to launch a debate with the aim of sub­mit­ting pro­po­sals to the public autho­ri­ties in this regard”. 


3.2 bil­lion euros in excep­tio­nal mea­sures to meet the chal­lenges of COVID-19

In order to give their insu­rance cus­to­mers maxi­mum sup­port to deal with the conse­quences of the health cri­sis, French insu­rers have taken a series of non-contrac­tual mea­sures total­ling 1.75 bil­lion euros, in soli­da­ri­ty with the popu­la­tions and busi­nesses most at risk. Half that ini­tia­tive is dedi­ca­ted to VSBs, SMEs, craft busi­nesses and retai­lers. The indus­try has the­re­fore dou­bled its contri­bu­tion to the soli­da­ri­ty fund set up by govern­ment to pro­vide help for those busi­nesses, increa­sing its contri­bu­tion to 400 mil­lion euros.

Also, as long-term inves­tors, French insu­rers have given an under­ta­king to govern­ment to sup­port the coun­try’s eco­no­mic reco­ve­ry after the health cri­sis. They have set up a glo­bal invest­ment pro­gramme invol­ving at least 1.5 bil­lion euros, most­ly from equi­ty, in par­ti­cu­lar for ISEs and SMEs and the health sector.

A fixed-term indus­try agree­ment on paid holidays

French social part­ners and the trade unions repre­sen­ting the bro­ke­rage indus­try have conclu­ded a fixed-term indus­try agree­ment on paid leave to help the pro­fes­sion cope with the coro­na­vi­rus crisis.

Construc­tive nego­tia­tions made it pos­sible to “conclude a fixed-term branch agree­ment on paid leave, which allows the employer to decide to take 6 days of paid leave acqui­red by the employee, or to uni­la­te­ral­ly modi­fy the dates on which paid leave is taken”, says a press release.

BELGIUM – Bel­gium puts real-time infor­ma­tion at the cen­ter of its concerns

Fepra­bel has crea­ted a spe­cial COVID-19 page on its web­site, aimed at kee­ping insu­rance inter­me­dia­ries infor­med of the latest news.

In order to help inter­me­dia­ries in their efforts, FEPRABEL offers infor­ma­tion and solu­tions gathe­red in a spe­cial COVID-19 file, modi­fied and com­ple­ted accor­ding to the situa­tion and the deci­sions taken by the com­petent authorities. 

A call cen­ter dedi­ca­ted to covid-19 

Seve­ral mea­sures to miti­gate the impact of the coro­na­vi­rus cri­sis on consu­mers, the self-employed and busi­nesses have been announ­ced. These mea­sures come from the autho­ri­ties as well as from the ban­king and insu­rance sec­tors, and are aimed at people and com­pa­nies finan­cial­ly affec­ted by the coro­na­vi­rus cri­sis and pro­vide, for example, for a defer­ral of mort­gage pay­ments, a defer­ral of tax pay­ments and a defer­ral of insu­rance pre­miums and second pillar pen­sion contributions. 

As the super­vi­so­ry autho­ri­ty in charge of consu­mer pro­tec­tion in par­ti­cu­lar, the Finan­cial Ser­vices and Mar­kets Autho­ri­ty (FSMA), has set up a call cen­ter for all those who have ques­tions about these measures. 

IRELAND — Consu­mer-focu­sed concerns

Cen­tral Bank of Ire­land Expec­ta­tions of Retail Inter­me­dia­ries in Light of COVID-19 

The Cen­tral Bank expects Retail Inter­me­dia­ries to take account of the dif­fi­cult and chal­len­ging situa­tion in which many cus­to­mers find them­selves, through no fault of their own and to take steps to sup­port them. The chal­lenges posed are unpre­ce­den­ted and will require a swift yet care­ful­ly consi­de­red approach to achieve the right out­comes for customers.

All Retail Inter­me­dia­ries need to be sen­si­tive to changes in cus­to­mers’ cir­cum­stances due to the public health mea­sures taken to coun­ter the spread of COVID-19, which have left many in a finan­cial­ly vul­ne­rable situation. 

Insu­rance Ire­land announces for­bea­rance and other mea­sures to help cus­to­mers during the Covid-19 crisis

Insu­rance Ire­land, an ins­ti­tu­tion which gathers 95% of natio­nal insu­rance mar­ket players, has writ­ten to the Minis­ter for Finance, Paschal Dono­hue, out­li­ning a com­pre­hen­sive range of mea­sures that the sec­tor is taking to assist cus­to­mers during the cur­rent Covid-19 crisis. 

The mea­sures include redu­ced pre­miums for busi­ness cus­to­mers to reflect redu­ced level of expo­sure as a result of Covid-19 res­tric­tions for EL / PL and Com­mer­cial Motor ; rene­wal flexi­bi­li­ty ; main­te­nance of exis­ting cover where the pre­mises is clo­sed or unoc­cu­pied ; sup­port change of use during Covid19 crisis. 

Insu­rance Ire­land states that most stan­dard busi­ness inter­rup­tion poli­cies in the Irish mar­ket do not sup­port a claim for a pan­de­mic such as Covid-19. This is also the posi­tion in the UK and across Europe. Howe­ver, insu­rers are very mind­ful of their com­mit­ments to the cus­to­mer and will adju­di­cate each claim fair­ly and consis­tent­ly in line with the poli­cy terms and condi­tions.