Insurance Europe Urges Regulators to Reconsider Proposed AML Rule Updates
Insurance Europe has called on European regulators to reassess certain aspects of the proposed anti-money laundering (AML) rules, warning that several elements under consultation could create unnecessary operational burdens for life insurance providers dealing with low-risk products. The federation submitted its position to the European Banking Authority (EBA) as part of the consultation on new Regulatory Technical Standards (RTS), which are being developed in line with the EU’s sixth Anti-Money Laundering Directive (AMLD6).
The proposed rules aim to standardize how financial entities assess and report on money laundering and terrorist financing risks. While the insurance industry expressed support for a harmonized and data-based approach, it highlighted that the reporting and data collection requirements outlined in the draft could result in disproportionate demands for insurers. Insurers already perform risk assessments under existing rules, and further data requirements – especially for low-risk life insurance products like pension schemes and pure risk policies – were described as unlikely to add supervisory value.
Insurance Europe proposed that any new data collection be built on current practices and that institutions be given a transition period to adjust internal systems before implementation. The industry group also recommended revising the data fields to be collected, particularly those not typically maintained in the insurance sector, such as the customer’s city of birth or multiple nationalities. These requirements, it noted, are often absent from commonly used identity documents and may be difficult for customers to supply.
Regarding remote customer identification methods, which vary across EU member states, Insurance Europe suggested that they should continue to be accepted. The federation warned against overdependence on electronic identification systems compliant with the eIDAS regulation, arguing that insurers should retain the ability to use established alternative processes, particularly in low-risk situations.
For simplified due diligence (SDD), Insurance Europe recommended that updates to customer data should be triggered by specific events, such as benefit payout or contract changes, rather than scheduled periodically. It also suggested that products with long durations and low AML risk be explicitly covered by sector-specific simplified measures. These include personal and occupational pension schemes, pure risk policies, and paid-up contracts with no ongoing premium payments.
Insurance Europe remains open to further engagement with EU institutions as the regulatory process continues, questioning whether the current proposals are fit for purpose across all financial sectors or if AML rules should consider product-specific risks more closely.
