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Insurance Distribution Directive (IDD)

The Insurance Distribution Directive enters into force in early 2018 (23 February). It is a recast of the existing Insurance Mediation Directive and is designed to ensure a level playing field across all participants selling insurance products. As such, its scope is broader than just the traditional insurance industry and it applies to all distributors of insurance products. In addition to insurance brokers / financial advisors and the direct salesforces of insurance companies this also includes distributors for whom the insurance is only an ancillary service such as car rental firms and airlines (with certain limited exemptions).

What does the IDD involve?

The IDD introduces enhanced information and conduct of business requirements including: 

  • Additional knowledge and competency requirements for distributors;
  • Product oversight and governance requirements (target market);
  • An Insurance Product Information Document (IPD) for non-life products;
  • Disclosures around product bundling;
  • Additional disclosure requirements in relation to insurance based investment products;
  • Mandated remuneration disclosures - the required disclosures are restricted to the nature of the remuneration and not the absolute amount.

At a high level the requirements are very similar to those under the existing Irish Consumer Protection Code.

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