EIOPA opens consultation on proportional supervision of insurance investment product sales

Traders Union
All News
Regulators
EIOPA on insurance product sales

Highlights

EIOPA launched a public consultation on a draft Supervisory Statement to encourage proportional, risk-based supervision for insurance-based investment product (IBIP) sales, open until 4 January 2027.
The consultation targets reducing unnecessary complexity in IBIP sales, with EIOPA seeking concrete input on simplification and safeguarding essential consumer protections without new regulatory requirements.
Feedback will inform both the final statement due in Q1 2027 and future EIOPA activities under the EU Retail Investment Strategy, impacting insurers, distributors, and regulators across Europe.

Consultation scope and timeline

As reported by EIOPA, the authority has launched a public consultation on a draft Supervisory Statement that is intended to help national supervisors apply a more proportionate and risk-based approach to the sale of insurance-based investment products, or IBIPs.

The draft keeps compliance-based supervision as the foundation of consumer protection, but adds a stronger focus on whether rules work effectively in practice. EIOPA says its monitoring and oversight work has identified weaknesses including sales processes built around mechanical completion of steps, disclosures that are too long or complex, and sales assessments that do not always meaningfully shape the final outcome for customers.

The proposed supervisory approach is designed to support a simpler customer journey by recognising that more documentation or extra procedural steps do not automatically improve results for consumers. Instead, supervisory attention would focus on shortcomings that materially affect consumer understanding, decision-making or the effectiveness of existing safeguards.

Stakeholders can submit feedback through an online survey until 4 January 2027, while responses will be published on EIOPA's website unless confidentiality is requested. EIOPA says early feedback by the end of November 2026 would be especially useful for its ongoing work tied to the European Commission's Call for Advice, and it expects to finalise the statement in the first quarter of 2027.

Implications for supervisors and the retail investment market

EIOPA is asking market participants for concrete examples of unnecessary complexity or duplication, along with views on simplification priorities and on the safeguards or trade-offs that should be preserved. The authority says the draft statement is meant to encourage more consistent supervision of IBIP sales across markets without creating new regulatory requirements, additional reporting duties or a fixed supervisory methodology.

Feedback from the consultation may also feed into future EIOPA work linked to the Retail Investment Strategy, including areas such as simple advice and suitability and appropriateness. That means the exercise has significance beyond the immediate statement, particularly for insurers, distributors and national regulators involved in retail investment distribution across Europe.

EIOPA also plans to hold an online public hearing during the consultation period to explain the proposed approach and discuss how it would work in practice with stakeholders. Further details on the event and registration are due to be released separately.

In our earlier article on a Philippine Supreme Court ruling on life insurance cancellation for medical non-disclosure, we explained that insurers may rescind coverage when an applicant omits material health information during underwriting, even without proof of intent to deceive. We also noted the court’s view that the two-year incontestability rule does not apply to short-term, credit-linked policies, reinforcing insurers’ ability to contest claims where undisclosed conditions are material to risk assessment.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.