It now seems irreversible the direction taken in Italy, for a couple of years now, by Regulators and financial intermediaries towards the goal of an accentuated simplification of insurance contracts, in the sign of the transparency of the clauses, greater customer awareness at the time of purchasing insurance products and a higher level of overall efficiency in this specific market. The impetus given by IVASS and the Guidelines identified by ANIA, after consultation between insurance companies, agents, brokers and consumer associations, has certainly constituted a notably important starting point for this simplification process.
It is, therefore, legitimate to ask whether after this initial push there have been further steps forward and whether the Covid '19 pandemic with its consequences in terms of minimizing physical contacts and, conversely, exalting remote relationships has further aided the process of simplification and transparency of the insurance market. The guests of a recent conference organized by the Banking and Financial Regulation Department of the Sapienza University of Rome in collaboration with the Helvetia Group tried to answer these and other connected questions.
Academics, regulators, trade associations of financial intermediaries and market operators agreed in underlining the centrality of the commitment to greater simplification and transparency. From Domenico Siclari, Professor of Economic Law and Financial Markets at the University of Rome for whom the objective to be set is "to identify the right balance between the needs of form and transparency and certain simplified ways of expressing consent in in any case capable of better protecting retail customers”; to Vincenzo Sanasi d'Arpe, Extraordinary Professor of Economic Law at the Marconi University in Rome, as well as CEO of Consap spa, who reiterated how "transparency combined with simplification becomes the emblem in the insurance market of a necessary syntactic simplicity lexical in order to make the insured more aware… transparency, then, must be combined with the tools of digitalisation, especially in insurance contracts that are increasingly stipulated in the inter absentes form”.
Until Stefano De Polis, Secretary General of IVASS, who underlined how "the clarity and simplicity of the contract and of the insurance documents which can rightly be accompanied by the duty of synthesis are an essential part of the governance of the product". Recalling, also, how these needs already implemented by the Private Insurance Code of 2005, have been reaffirmed by a recent sentence of the Court of Cassation (15598 of 2019), as well as by community jurisprudence. A line of thought, the one expressed by De Polis, which testifies to the characteristics of a particularly sensitive and active regulator on this specific front, also ready to promote what is necessary for the safe use of digital technologies applied to insurance market contracts.
However, these are not easy goals to achieve. Just think of the critical issues detected by Giovanni Calabrò, Director General of the AGCM for the Consumer Protection sector, who recalled "the need to eliminate some gray areas that persist" as in the particularly delicate case of policies sold in combination with loans, a situation in which consumers do not have specific insurance needs and are looking for other products, with a purchase that it can therefore occur on impulse and without complete awareness and freedom of determination"; or the other, even worse, of the consumer who in his capacity as a worker who loses his job "is convinced that the policy guarantees relief in such an event and asks the insurance company to take over the repayment of the debt, unless being opposed by a denial due to lack of coverage”.
Nor can the diagnosis offered by be overlooked Dario Focarelli, Director General of ANIA, when he recalls that "the insurance market is a market with a high intensity of regulation accentuated by the irruption of digitalisation". And he warns of the difficulty of achieving two challenging objectives: the first is to "reduce the system of disclosure obligations, focusing on the key information in the pre-contractual documentation (Kid and Dip) which are essential to contain the dizzying increase in the number of individual communications between intermediaries and customer; a number destined to increase further with the new regulation on disclosure relating to sustainability”.
The second objective is linked to the "creation of a legislative framework suitable for the digital age with some qualifying points, such as the rationalization of the consents expressed by the customer to use digital means, the provision of standardized processes to facilitate communication and the elimination of 'obligation to send paper documents replaced by their availability in IT mode". A path, therefore, characterized by criticalities to overcome and challenges to meet, in which the experience already gained by the Italian Banking Association on this specific side of contractual simplification should be very useful. He also underlined it Deputy Director of ABI, Gianfranco Torriero, recalling the initiatives activated with the Consumers' Associations within the "Simple Transparency" project.
“Initiatives – said Torriero -, which naturally need continuous monitoring and implementation to be adapted to the evolution of the market… The pandemic crisis, the acceleration of digitization and the accentuation of remote contact methods with customers have also had as a consequence/accompaniment a simplification, via urgent decree, of the procedures for signing bank contracts". "This simplification" - added Torriero - "has a temporary duration but the experience of recent months has brought out a structural need for simplification and at the same time has allowed us to focus on the areas on which to intervene: the application perimeter, the probative effectiveness, connection with related documentation, coordination with other regulations".
The voice of the insurance operators, represented by Fabio Carniol, General Manager of Helvetia Italia and Helvetia Vita, emphasized the fact that "simplicity and clarity are becoming a critical success factor in a market where digitization is changing expectations and customer priorities and in which legislation requires insurance companies to design and offer products consistent with the needs of different customer segments. Carniol also underlined that “clarity and simplicity are sources of competitive advantage, because they preserve the relationship of trust with the distributor and his customer. They become essential in direct sales through digital channels in which the customer must have full awareness of the perimeter of the coverage he has purchased".
Domenico Siclari agrees with this line of thought for which "it is necessary to exploit all the new digital potential in a manner proportionate to the customer's capabilities and needs, recognizing how the progressive simplification and clarity of insurance contracts can ultimately become a source of competitive advantage for the companies, also helping to reduce the subsequent conflict between intermediaries and customers". Therefore, from all these testimonies an approach emerges not dictated by an optimism of manner, but by a healthy and constructive competitive will to compete with the new challenges of the insurance market. A paradigm which, if accompanied by an equal overall sentiment of the Regulators, the Trade Associations of intermediaries and consumers, will contribute to making the Italian insurance market a model of efficiency and transparency, stimulating not only the financial cultural growth of the country (critical aspect also evoked by Carniol), but above all the, no less important, socio-economic one.
