EC delays findings of industry probe Interim report may be held back till FebruaryPosted On: Dec. 17, 2006 12:00 AM CST
[BRUSSELS]The European Commission has confirmed that its interim report into competition in the business insurance sectorlaunched in the summer of last yearwill not be ready until January and could even slip into February.
The Commission sent detailed questionnaires to leading insurance trade bodies at the end of 2005, and to individual insurance companies and brokers in early 2006.
It intended to use this information as the basis for an interim report planned for the end of this year.
But a spokeswoman for the Commission told Business Insurance Europe that the interim report being prepared by the Competition Directorate had been delayed because of "administrative reasons" and "various planning purposes."
The spokeswoman declined to give any more details, but conceded that it could even "slip to early February."
The EC will hold a public hearing on February 12 to debate its report.
The meeting will form part of a 10-week consultation period that will enable third parties to respond to the interim report and help the Commission prepare the final report which is expected in June next year.
The purpose of the inquiry is to determine whether the structure of the business insurance market in Europe is distorting or restricting competition.
The United Kingdom's Financial Services Authority said last week that the Commission is looking at standard policy wordings, co-insurance arrangements, access to risk data and statistics and commission disclosure.
One Brussels-based lobbyist told BIE/i> that the core issue will be whether or not the Commission will allow the insurance sector to continue to benefit from what is know as a "block exemption" that enables it to share data unlike most other industries.
This exemption was granted by the Commission because it was decided that the insurers need to share data and information in order to come up with the relatively accurate risk measurement needed to devise adequate pricing that enables them to offer their products and services in the first place.
As the EC continues its investigation, other major European regulatory bodies are pursuing their own investigations into the sector.
The FSA is stepping up its review of intermediaries and commission disclosure and has again warned intermediaries that if they are not satisfied that brokers are providing insurance buyers with sufficient quantity and quality of information then it may make disclosure mandatory.
The German Financial Supervisory AuthorityBaFincontinues its investigation of the industrial insurance market that was accused of collusion as rates rocketed following the terrorist attacks on New York and Washington in 2001.