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What's the IDD ?
IDD stands for "Insurance Distribution Directive". It is a European directive in force since 2016, whose ordinance and decrees were published in France in May and June 2018. The IDD effectively repeals the Insurance Intermediary Directive (also known as IMD1).
The 4 PRINCIPLES of the IDD
In a context where customers are increasingly demanding in terms of the services and products provided to them, national and European standards on consumer protection are becoming ever more stringent.
- Making insurance distribution standards more uniform
- Making standards of conduct more efficient
- Increasing consumer protection
- Putting in place competitive factors
While the previous IMD1 Directive only applied to intermediaries in the sector, this is no longer the case with the IDD, which now also applies to direct sellers. In short, all players in insurance distribution (including producers) are involved in this Directive.
The key principle
"Every insurance distributor must act honestly, impartially, professionally and in the best interests of its customers". This is in order to combat possible conflicts of interest, and to regulate the distribution of insurance so that the distributor does not have to seek the interest, but rather to respond as closely as possible to the needs of the customers.
The main rules of the DDA
- Reinforcement of pre-contractual information for policyholders
- The principle of sound sale: in other words, the sale must be non-abusive vis-à-vis the customer; the contract of sale must be of sound will on the part of both parties.
- The implementation of continuous training for insurance players (15 hours per year) which must be followed and evaluated.
- The implementation of rules of supervision and governance on insurance products
- A principle of transparency on remuneration
What's at stake for companies :
The obligation to train for all these intermediaries requires the need to put in place internal processes to facilitate and automate training. The objective? To benefit from a single tool, which makes it possible to centralize the training of all learners, but also to be able to track results, progress and certificates.
In short, to be able to act in compliance with the IDD serenely and efficiently.