EU Retail Investment Strategy: unclear rules, high costs for insurers
The trilogue negotiations on the EU’ Retail Investment Strategy will start in Brussels on 18 March 2025. GDV is calling for pragmatic solutions from the negotiating co-legislators. The final set of rules should be simple and understandable, for consumers and companies alike.
The aim of the Retail Investment Strategy is to encourage more people to invest in Europe’s capital markets by boosting confidence and removing barriers to entry. Insurers expressly support this goal. However, the current proposals threaten to have the opposite effect - especially for the insurance industry and its customers. The current proposals are:
too complicated and too costly: Instead of creating more clarity, the planned rules could lead to even more and more complex requirements. New documentation, reporting and retention obligations will lead to considerable additional costs for insurers - without any recognisable added value for customers. Instead of simplifying the investment process for private customers, the current proposals would make product development and advice more cumbersome due to the introduction of excessive administrative burden.
too unclear: Many crucial details remain open until even after the end of the legislative process, as they are only to be regulated in secondary regulation or technical standards. For insurers, this means long periods of uncertainty: they do not know which specific requirements they have to fulfil. This makes reliable planning and legally compliant implementation virtually impossible.
impractical in their implementation: The implementation deadlines for the new rules should only begin once all the details have been finalised. Otherwise, insurers will be under enormous time pressure and a smooth transition cannot be guaranteed. This could affect the availability of products and the quality of advice.
For the trilogue negotiations, insurers are calling for a clear and conclusive rules directly in the directive instead of subsequent adjustments via additional secondary regulations. In addition, the administrative burden must be proportionate to the actual benefits for consumers. This applies in particular to reporting, documentation and retention obligations.