By George Nicolaides, Founder and Chief Executive Officer of Gan Direct
If someone had asked me ten years ago what would become the single most significant force shaping the European insurance market, I would probably have answered technology or artificial intelligence. Today, however, I believe the biggest change is something entirely different. It is the customer.
For decades, the insurance industry was built around products, distribution channels and companies’ internal processes. The customer stood at the very end of the value chain. They had limited access to information, very little ability to compare alternatives and even fewer opportunities to switch providers. That reality is now changing rapidly.
If one looks at almost every major European regulatory reform of the past decade, a common thread quickly becomes apparent. They were not designed to make life easier for insurance companies. They were designed to make customers better informed, more empowered and better protected.
The Insurance Distribution Directive (IDD) goes far beyond ensuring regulatory compliance for insurers. It forms part of a broader European philosophy that seeks greater transparency, better consumer information and stronger customer protection. The same philosophy underpins Product Information Documents (PIDs), the use of clear and straightforward language in insurance policies, enhanced consumer rights, and the ongoing discussions surrounding Open Insurance and data portability.
Europe is not simply seeking to change the rules governing the insurance industry. It is seeking to redefine the relationship between insurers and their customers.
Today’s policyholder is expected to know more before purchasing an insurance product. They are encouraged to compare different options, understand exactly what is and is not covered, know how the person recommending a product is remunerated, and be able to switch providers more easily whenever doing so better serves their interests.
It is no coincidence that several European countries have gone beyond the minimum requirements established by European legislation. Markets such as the Netherlands, Sweden, Slovakia and Denmark have introduced much stricter transparency rules regarding intermediary remuneration, while in some cases certain commission models have even been prohibited. Other jurisdictions require intermediaries to disclose in advance the exact amount or percentage of their remuneration. Regardless of whether one agrees with these approaches, the direction is unmistakable. The European insurance market is moving towards greater transparency and better-informed consumers.
Cyprus has taken a different approach. Our country has adopted the core requirements of the European Directive without implementing the additional measures introduced by some other Member States. This is not necessarily a right or wrong decision. It is, however, a choice that deserves ongoing discussion, particularly as consumer expectations continue to evolve.
In my view, the real issue lies elsewhere.
Transparency should not be viewed as a threat to either the insurance industry or its professionals. On the contrary, it represents an opportunity. When customers understand what they are buying, they feel more confident about their decisions. When they know what is covered, how the premium is determined and what value they receive in return, trust begins to develop—something that advertising campaigns and commercial offers alone can never achieve.
The same principle applies to the language we use.
The insurance industry still too often communicates in terms that many consumers find difficult to understand. Lengthy policy documents, complex exclusions, technical terminology and procedures that create more questions than answers remain common. This, too, is changing.
New generations of consumers have grown accustomed to services that are simple, digital and intuitive. They no longer accept complexity as inevitable. They expect to compare products easily, make decisions quickly and understand exactly what they are purchasing. This represents a challenge not only for insurance companies, but for the entire insurance ecosystem.
I believe that in the years ahead, the companies that stand out will not necessarily be those offering the widest range of products. They will be those delivering the clearest customer experience, the highest levels of transparency and the greatest ease of doing business.
The most significant transformation taking place in Europe today is not about insurance products. It is about the transfer of power from insurers to customers.
Those who recognise this shift early will not merely comply with the new European regulatory framework. They will help shape the future of the insurance industry itself.
At Gan Direct, we have believed for more than thirty years that outstanding customer service does not begin when an accident occurs. It begins when customers fully understand what they are buying, feel confident comparing their options and know that they are at the centre of every decision.
That is the message Europe is sending today, and it is one we must put into practice—not only for the benefit of our industry, but above all for the benefit of the people we serve.
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