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PRIIPs: Real solutions, not superficial quick fixes, needed to fix problems with the Key Information Document

Insurance Europe is seriously concerned by the quick-fix approach taken by the European Supervisory Authorities (ESAs) in their proposals for changes to the Key Information Document (KID) for Packaged Retail Investment and Insurance Products (PRIIPs) which we do not believe will be of benefit to consumers.

Moreover, as an end to the UCITS exemption looks increasingly unlikely, there seems to be no reason to rush-through these measures. It is therefore vital for the ESAs to properly address the underlying problems with the PRIIPs KID and not just propose superficial and ineffective responses to these fundamental problems.

It is vital that the ESAs conduct a thorough impact assessment and proper consumer testing to ensure the KID is fit for purpose, so that consumers are provided with meaningful information. It needs to be evidenced that the consumer will benefit from such proposals, in order to justify the significant system changes and compliance costs for insurers.

Without a well-considered and evidenced approach, the proposed changes could back-fire and lead to further confusion among consumers and a loss of their trust in the KID and the information presented to them.

Insurance Europe firmly believes that any fundamental changes to the PRIIPs KID, including solutions to the problems with performance scenarios, should therefore only be considered as part of the formal review. Only well evidenced changes as part of a thorough, comprehensive review can ensure that the PRIIPs KID is fit for purpose.

Insurance Europe’s specific concerns are detailed in its response to the ESAs' consultation concerning amendments to the PRIIPs KID, which is available here.

Published 10 December 2018
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