The Commission has begun a public consultation to investigate the functioning of the Insurance Block Exemption Regulation (BER) and the impact on the various insurance markets in the European Union (EU). (See: Copy of Consultation Paper) The public consultation will also be combined with targeted questionnaires sent to industry, national regulatory and competition authorities, as well as consumer groups. The BER exempts from the EU treaty’s ban on restrictive business practices (Article 81) certain co-operation agreements between insurance companies including the establishment of non-binding standard policy conditions, the exchange of statistical information for the calculation of risks and the creation of co-reinsurance pools.

The Consultation Paper sets out the observations which the Commission received on the BER during its latest Sector Inquiry into Business Insurance and from a recent consultation of national competition authorities, as well as the Commission’s current considerations and case experience. (See previous blogs: European Commission Issues Final Report on Business Insurance Inquiry and European Commission: Competition  in Business Insurance Inquiry: Reponses prepared by Insurance Bodies.  ) The Commission is chiefly interested in discovering where the BER is being used and why; whether insurers’ business risks make them different from other sectors and whether the BER creates anti-consumer side effects, such as higher pricing or reduced insurance supply. Another issue which will be examined is whether the operation of the insurance sector without a BER would lead to more of a burden on supervisory authorities and competition law enforcement.

Insurers have until 17 July 2008 to persuade the Commission that there are sufficient grounds to  renew the BER beyond 2010, after which the Commission will draft a report and conduct an impact assessment. If the Commission decides to renew or revise the BER, the Commission will consult on a draft. If no further BER is to be enacted, the Commission will publish a communication to that effect in 2009.

Comments can be e-mailed to COMP-GREFFE-ANTITRUST@ec.europa.eu quoting the reference: “Review of Insurance BER – COMP/D1 HT 1221”.