On 21 February 2012, the Chairman of the Polish Financial Supervision Commission (“KNF”) sent a letter on bancassurance to the management boards of all insurance companies and banks in Poland.
The letter sets out what the KNF perceives as irregularities that result from the current cooperation between banks and insurance companies. The particular focus of the KNF is on group insurance policies issued in respect of bank loans. The KNF letter criticises the practice of banks acting simultaneously as insurance intermediaries and as policyholders. It claims that banks that receive a commission from insurance companies under an insurance contract should be considered insurance intermediaries and may, therefore, not also be policyholders.
The KNF takes the view that the current bancassurance structure fails to protect properly the interests of bank clients. In particular it notes that the current group structure makes it impossible for insureds or their heirs to bring claims directly, prevents insureds from accessing the insurance contract and limits the freedom of choice of insureds to choose an insurer.
The KNF also notes that the banks’ commissions are excessively high. It has stated that it doesn’t want to introduce any statutory limits on commissions. However, it is considering imposing an obligation on banks to disclose the amount of the commission to the bank's customers.
The letter is just the beginning. The KNF has stated that it will begin preparing a code of good practice for the bancassurance market and will also propose legislative amendments with regard to bancassurance. Additionally, according to press releases the Insurance Ombudsman and the President of the Office for Competition and Consumer Protection are analysing the legality of current practices on the bancassurance market. This means that the bancassurance market is likely to face some difficult changes.