EU countries are still required to transpose IDD into national law by the original date, 23 February 2018.
“Despite the transposition period foreseen and the fact that the date of entry into application was well known to stakeholders, it appears that some insurance distributors, especially smaller ones, are not yet fully ready for the new rules,” the European Commission said in a statement on the “exceptional” delay.
“Whilst the IDD took many years to finalise there has been a relatively short time between the issuance of the final text and the intended commencement date, not unlike MiFID II,” observed Paul Stanfield, FEIFA, chief executive.
“This has meant that some of the detail and guidelines from the European regulators, EIOPA specifically in the case of the IDD, have only been issued and received in the fairly recent past. This has made it extremely difficult for the industry to make the changes required, which in some sectors and countries are significant. Therefore, given that the initiation of MiFID II and PRIIPS were both delayed it is perhaps not all that surprising that the commencement date for the IDD now appears to be suffering a similar fate.
“However, it’s important to remember that one of the main goals of this directive is to provide greater and wider-ranging protection for consumers – the earlier it commences the better, but only if all necessary frameworks are in place to ensure that implementation creates the intended results.”
To align the application dates, the Commission is also preparing to postpone the application of two delegated regulations adopted under the IDD.
The European Parliament and the Council of Ministers will need to agree on the new application date in an accelerated legislative procedure.