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Policyholders of group insurance policies may require a licence
from the Netherlands Authority for the Financial Markets
(AFM) as an intermediary from 1 October 2025.This
licensing requirement is relevant for a wide range of companies
including, for example, companies in the transport and moving
sector that offer insurance to their customers where the companies
concerned are themselves policyholders. According to the AFM, if
the policyholder of a group insurance policy offers its customers a
choice of joining the insurance policy and the policyholder
receives a fee for this in return, this qualifies as providing
intermediary services for which, in principle, a licence is
required. If a licence is required, it must be obtained before 1
October 2025.
Background and the interpretation
The AFM’s interpretation is a consequence of a judgment of
the Court of Justice of the European Union (CJEU 29 September 2022,
C-633/20, ECLI:EU:C:2022:733). With the interpretation, the AFM
provides further guidance for practice. According to the
parliamentary history of the concept of the provision of
intermediary services, the term “intermediary” expresses
that the intermediary does not become a party to the insurance
contract. However, the CJEU does not consider it decisive whether
the intermediary is itself a party to the insurance contract, what
is relevant is whether a party performs similar activities for a
fee.
Licensing requirement for group insurances
A group insurance is an insurance contract entered into between
a policyholder and insurer under which one or more third persons
may be included as insured person(s) on the policy. According to
the AFM’s interpretation, if the following two conditions are
met for group insurance, there is a licensing obligation for the
provision of intermediary services:
- There is an optional element; and
- A fee is paid.
Optional element – automatic or non-automatic
inclusion
If the insured is automatically added to a group insurance
policy and does not have an option to do so, this does not
constitute intermediary activities for which a licence is required.
This could include the situation where a child is enrolled by its
parents at a school, where the child is automatically added as an
insured in the school’s accident insurance.
It is different when the insured has the choice to join the
insurance contract, which allows the insured to decide whether to
take up the offer of insurance. This is non-automatic entry. The
offering of certain options or the possibility of dropping certain
options within the offered insurance is also seen by the AFM as an
optional element. By way of illustration, this includes the
situation where a moving company offers the option of taking out
insurance against damage to the goods on the moving day.
Remuneration
In addition to the fact that there must be a non-automatic entry
into a group insurance policy, the policyholder must receive
remuneration for the service provided in order to trigger the
licence requirement. The concept of remuneration should be
interpreted broadly. Any (economic) benefit of any kind qualifies
as a remuneration.
The AFM clarifies in its interpretation that there must be a
financial benefit for the policyholder – passing on premiums and
(administrative) costs is not considered as a fee by the AFM. This
means that if the group insurance is offered to the customer as a
‘service’ without providing any financial benefit to the
policyholder, there are no intermediary service provided for which
a licence is required.
Secondary insurance intermediary: exception from Section
7 Exemption regulation Wft
In the situation where there is (i) freedom of choice for the
customer and (ii) a remuneration for the policyholder, in
principle, a licensing obligation as intermediary applies. In those
cases, the exemption regulation is still relevant. Section 7 of the
Exemption regulation Wft (Vrijstellingsregeling Wft)
regulates that persons who mediate in insurance in addition to the
supply of an item or the provision of a service are largely exempt
from the Dutch Act on Financial Supervision (Wet op het
financieel toezicht) under certain conditions. To qualify for
this exemption, certain conditions must be met. This means that if
the policyholder of a group insurance policy can demonstrate that
the insurance product being offered meets the conditions set out in
Section 7 of the Exemption regulation Wft, the policyholder can
make use of this exemption and the licensing obligation does not
apply after all. The foregoing can be depicted as follows:
Based on the interpretation of the AFM.
Next step
The AFM’s interpretation may have a significant impact on
market parties who currently do not have a licence for
(intermediary) activities in group insurance. For each group
insurance policy, it will have to be determined whether there are
intermediary activities that requires a licence. The decision tree
as depicted above can be helpful in this respect. If a licensing
obligation arises, we recommend taking action on this quickly, as
the relevant companies must have a licence no later than 1 October
2025.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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