IVASS: simplification of the non-Life insurance bureaucracy

They implemented Article 22, paragraph 15 bis of Law Decree No. 179 of 18 October 2012, entitled “Further urgent measures for the growth of the Country”, as converted into law No. 221 of 17 December 2012.

Limited to non-Life insurance branch, IVASS will work on the definition of measures aimed at simplifying both procedures and bureaucracy, with particular reference to reducing the paperwork and the set of forms in the contractual relationship between insurers, intermediaries and customers. It will also promote digital relationships, the use of certified e-mail account, digital signatures and electronic as well as on-line payments.

The purpose of the regulation is, thus, to realize a “simplification” through both the use of technological innovation and the reduction of paperwork and set of forms.
This created the opportunity for a review of the regulations in force concerning brokerage, information transparency and distance contracts, in the light of new “simplification” applications.

IVASS, starting from March 2013, carried out a series of pre-consultations with ANIA and the major associations representing insurance intermediaries, with the aim of both acquiring comments and proposals and meeting needs of the categories involved by the measure.

They highlighted some aspects on which to focus the activities of the legislative “simplification”:

  • the need for intermediaries, to “reduce” the documentation to collect underwriting and the ability to acquire it just once in the event of contracts with the same company concluded through the same intermediaryThey highlighted some aspects on which to focus the activities of the legislative “simplification”:
  • the need to reduce the copious documentation that companies and intermediaries must issue in paper form to customers in the pre-contractual and contractual phase, even through the adoption of more synthetic and effective information documents which enable a reduction in costs related to the emission and print of the documentation

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Also meetings with consumer associations were particularly fruitful and indeed necessary, since the issue directly affects contractors and policyholders.
Consumer associations have in fact underlined that the pre-contractual information is often difficult to understand and the abundance that characterizes it does not facilitate the effective knowledge of the essential elements of the contract.

With regard to the digitalization of the contractual relationship, they raised concerns about the possible “irreversibility” of the report from telematics to “traditional” (with paper exchange of documents); they therefore stressed the importance of maintaining voluntary and revocable the on-line communication process and excluding the imperativeness for users to adopt the use of electronic mail or electronic signature.

The review of the ISVAP regulations No. 5 on insurance brokerage, No. 34 on the distance sales of insurance products, and No. 35 on information requirements, aims at reducing bureaucratic fulfillments but also at providing the consumer with the tool necessary to make an initial rapid and effective assessment of the product that is going to buy through consultation, for contracts related to damage products, of a summary table.
This document will complement existing information documents by enclosing in a synthetic and sketched manner the main contents of the contractual relationship.

Taking into account the organizational impact related to the preparation of the technological infrastructure, it has been provided a three-months period from the entry into force of the regulations for intermediaries to fulfill the obligation to adopt certified e-mail account and electronic payment instruments. The same period of time is considered adequate to allow companies to prepare the summary table and make it available to customers.

As for the impact of the Regulations, it is mostly about administrative activities of firms and intermediaries.

Against an initial burden arising from the acquisition of certified e-mail account and electronic payment instruments (as well as, where appropriate, from the spread of electronic signature), it is expected a significant cost reduction in the overall conduct of the activity.

This benefit is expressed in terms of cost savings (reduction in the printed media, simplification of storage mode, etc.), optimization of resources addressed to the sales development rather than merely administrative and bureaucratic activities, promptness and effectiveness in communications with customers, and, ultimately, improvement of the dialogical relationship between parties.