The EU’s public consultation on open insurance, focused on access to and sharing of insurance-related data, is this week drawing to a close.

The European Insurance and Occupational Pension Authority launched its consultation in January, following the publication of its Discussion Paper which explored questions on whether and how far insurance value chains should be ‘opened’ up by the sharing of insurance-related and specific policyholder data amongst insurance and non-insurance firms, to protect policyholder rights and to allow for innovation in products and services.

The main areas of the consultation include open insurance definition and use cases; risks and benefits of open insurance; regulatory barriers; and possible areas to consider for a sound open insurance framework.

Sanjiva Perera, managing principal at Capco, said open insurance should bring an increase in innovation, but only if regulation, standards, security and ethics are sufficiently assessed.

“It’s vital that suitable protections are put in place, both in the form of mandatory regulation and voluntary standards, to ensure customer data is not exploited. With regards to regulation, we need to see a common definition of data items and attributes that will be accessible through APIs. It’s also imperative that clear permissions are defined to allow customers to share data, which may be specific to the type of data, time period, and purpose of use, for example.

“We need to remember that open finance is about increasing choice and financial inclusion, and allowing more people to access a greater range of products and services. Firms should be prevented from profiling customers with the intention of excluding them on unethical grounds, such as gender, race, postcode, sexual orientation. The data ethics angle is a minefield, and while we have seen equality legislation proliferate in most countries, it has often lagged behind the explosion of data that has occurred over the same period. Accordingly any legislation will need to catch up, and in the interim firms will need to carefully consider how they can best implement and demonstrate ethical practices," he said.

Perera foresees harmonisation efforts coalescing under a single entity in order to create common standards and achieve synergy benefits.

"Good prior examples of this approach are the Open Banking Implementation Entity set up in the UK to oversee the implementation of open banking, or the Money and Pensions Service taking ownership of the pensions dashboard project with participation from a range of industry participants,” he explained.

Interested parties may provide views via the EU's survey tool by the 28th April here.

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