What should a customer look out for before concluding a life insurance contract? The Austrian Financial Market Authority (FMA) informs consumers in in its updated brochure (in German only) “Welche Informationsrechte hat der Versicherungskunde?” (What information rights does an insurance customer have?”) To help make the information even easier to understand, an explanatory video has been created to accompany the brochure. Both can be found on the FMA’s website (in German only). “The well-informed customer is an important pillar for collective consumer protection. We are therefore always try to explore new ways to inform consumers in a comprehensible manner about the financial market and financial products. Our new brochure and the new video help place potential and existing insurance customers in a position to compare available offers more easily, and to be able to then more actively and precisely ask questions during the meetings with advisors,” remark the FMA’s Executive Directors Helmut Ettl and Klaus Kumpfmüller.<\/p>
The information brochure and the video offer a concise overview about the various categories of life insurance products that are available and their main product features. They explain to (potential) policyholders about their rights of information, that they have both prior to the conclusion of the insurance contract and throughout its entire term towards an insurance undertaking. For example, an insurance company must explain the scope of a guaranteed benefit in a clear many and specifically refer to any guaranteed amount. Furthermore the insured persons must be informed on an annual basis about the current value of the insurance benefit. In the glossary section contained in the brochure there is also a set of terms in relation to the insurance sector that are explained, such as what an effective interest rate is.<\/p>
The information brochure has been comprehensively revised this year and adapted in line with the new legal provisions for insurance distribution; as well as being adapted in line with the FMA’s Life Insurance Information Requirements Regulation 2018. The material changes relate to the general obligation to provide advice, the possibility not to receive device and the consequences associated with doing so for the customer, the mandatory needs and wants test, as well as the standardised information documents and tables containing a breakdown of costs that are to be used during the sales process.<\/p>