The European Commission has taken the first step towards the review of the Insurance Block Exemption Regulation (IBER), which will expire in 2017. A consultation was launched on 5 August and will last until 4 November. This must be seen as a first round to collect the views of all stakeholders dealing in some way or another with the insurance practices covered by the IBER.

The IBER is a sector-specific legal instrument that grants an exemption from EU antitrust rules for insurance practices like co(re)insurance pools, compilations and tables. The first IBER dates back to 1991 and was renewed in 2003 and 2010.

The insurance sector is one of the three remaining sectors (the other two being maritime liner shipping and motor vehicle distribution) that still benefits from a block exemption regulation. The Commission did not renew most of the others over the last decade.

In 2013, following the release of a report commissioned by the Commission and written by EY, FERMA took a position in favor of maintaining the IBER, stating that “the exemption to the application of EU competition rules is providing more benefits for the market than issues. Some pools on national levels are really needed where the traditional insurance market is not interested or can’t solve temporary market problem on its own, especially with unusual risks (terrorism, natural catastrophes…) and specific areas of activities (shipping, nuclear, aviation sector…).”

For the Commission, the question is now to decide if there is still ground for an exemption from EU competition rules. The benefits claimed for the insurance market of such practices must justify the special treatment they receive from EU competition authorities.

As for the next steps, a full report should be submitted by 31 March 2016 by the Commission to the European Parliament and the Council in order to reach a final decision on the renewal by March 2017.

This consultation is therefore opening a two-year window in which the fate of the IBER and the corresponding insurance practices will be decided.