EIOPA Methodology On Value For Money Benchmarks

EIOPA recently published its methodology on Value for Money (VfM) benchmarks in relation to unit-linked (UL) and hybrid insurance products. For some time, EIOPA has been reporting on risks arising from the complexity and limited benefits for consumers in respect of UL and hybrid products (see in particular the EIOPA supervisory statement on VfM in 2021 and the methodology to assess value for money in the unit-linked market in 2022, and our previous article).

The objectives of the benchmarks are primarily to assist national competent authorities (NCAs) in identifying products with higher VfM risks and eventually to allow comparability so that insurance product manufacturers can determine if their products will offer value.