FERMA has made its first review of the final report of the European Commission sector inquiry into business insurance
The Federation of European Risk Management Associations (FERMA) has made its first review of the final report of the European Commission sector inquiry into business insurance.
On co-insurance and co-reinsurance, FERMA said: “We will be contacting insurance and broker associations to define with them what improvements could be made to market practices to satisfy the Commission’s concerns. We are ready to talk again with the Commission about the block exemption in time for its 2009 report. This is the subject of continuing discussion within FERMA.”
On broker remuneration, FERMA added: “We invite the broking community to take better initiatives than it has done so far to meet the requirements of business insurance buyers, and we encourage the Commission to amend the intermediation directive towards a true transparency.“
The President of FERMA, Marie-Gemma Dequae said: “The proposal by two further major brokers to charge insurers an additional 2.5% commission, in addition to the one broker who is already doing so, shows clearly that there is a fundamental problem for the Competition Directorate to address. FERMA’s stated position is that payment for broking services should be set by negotiation between the buyer and the broker and that it should be fully transparent.”
On long term contracts, FERMA is satisfied with the European Commission’s conclusion to allow three year deals to continue.