Insurance Guarantee Schemes (IGS)

Insurance Guarantee Schemes (IGS) provide last-resort protection to consumers when insurance companies are unable to fulfil their contractual commitments. They protect people against the risk that claims will not be met if their insurer becomes insolvent. Only a few EU countries have insurance guarantee schemes in place (there are specific EU Directives for the banking and securities sectors on deposit guarantee schemes and on investor compensation schemes).

To address the regulatory loopholes and inconsistencies in the EU, over the last years, the European Commission has carried out a review of the adequacy of existing national insurance guarantee schemes in order to make an appropriate legislative proposal, such as a Directive that would ensure that insurance guarantee schemes exist in all EU Member States and comply with a minimum set of requirements. It consulted the industry, including BIPAR. Until now, the work of the Commission has not covered the failure of insurance intermediaries.

It is unlikely that the European Commission will issue its proposal in 2017.

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