Round Up Autumn 2018

8 Insurance Distribution The Insurance Distribution Directive (IDD) comes into force on 1 October 2018 and replaces the current Insurance Mediation Directive (IMD) It’s designed to create a level playing field for all those involved in the sale of insurance products. These include: -- Non-investment insurance contracts. For example, pure protection contracts and life policies such as long-term insurance contracts and annuities. -- Insurance-based investment products (IBIPs). For example, investment bonds and endowments, and -- General insurance contracts. What are insurance-based investment products (IBIPs)? IBIPs are defined as a contract of insurance which offers a maturity or surrender value, and where that maturity or surrender value is wholly or partially exposed, directly or indirectly, to market fluctuations. An IBIP doesn’t include: -- Non-life insurance products. For example, pure general insurance. -- Life insurance contracts where the benefits under the contract are payable only on death or in respect of incapacity due to injury, sickness or disability. -- Pension products which, under national law, are recognised as having the primary purpose of providing the investor with an income in retirement, and which entitle the investor to certain benefits. -- Officially recognised occupational pension schemes falling under the scope of Directive 2003/41/EC or Directive 2009/138/EC. -- Individual pension products for which a financial contribution from the employer is required by national law, and where the employer or the employee has no choice as to the pension product or provider.