Dear Vice-President Dombrovskis,
During the ECON Committee of the European Parliament, which took place on the 20th June this year, I brought to your attention the concerns of the Insurance industry, in particular from Malta, regarding the lack of time for the correct application of the Insurance legislation referred to above.
In the course of that hearing, I pointed out that the Commission’s timeline for the finalisation of the delegated acts would leave too little time for the Member States and their insurance sectors to implement on the ground, the updates of the Insurance Distribution Directive by 23 February 2018, creating difficulties related to the legal certainty to effectively transpose the rules into the national legislation. Particularly badly hit by this approach will be SMEs in insurance, which predominate in Malta, but not only there.
Therefore, I called upon the Commission to consider a possible postponement of the implementation deadline. In your reply to my question, even if you had agreed with me on the very ambitious nature of the timetable set in the legislation, you expressed strong opposition to a possible postponement arguing that this would send the wrong signal to the sector.
Now that the Commission has adopted the delegated acts, the difficulties, then already forecasted by the Insurance sector, have materialised. Many insurance companies and associations raised this problem, not only from Malta, but also from other Member States. Therefore, I am addressing you this letter in order to request that you reconsider the application of a one-year delay for the implementation of the legislation.
The Insurance Distribution Directive affects the entire distribution chain for insurance products, with many different stakeholders involved, and necessitates significant changes, mainly for SME operators. The industry will need to revise and adapt existing processes and policies, while designing and implementing new ones in a number of different areas. Even the IT systems will have to be changed in order to support the changes in the processes that the legislation requires, with significant costs for the companies.
All players in the insurance sector do not oppose the changes in any way but they are pleading that they need more time. It is of utmost importance for these changes to be uniformly implemented across Europe, without creating discrepancies among companies in different Member States and of different size. Only a realistic transposition period would allow this.
I am therefore appealing to you to reconsider the situation and accept to delay the implementation period by twelve months. Given your well-known commitment to the improvement and enhancement of SMEs in Europe, I am confident that you will agree that in the insurance sector, it is just and proper that their legitimate interests and reasonable claims be taken into account.
I remain at your disposal for any further clarifications.
Alfred Sant MEP