The European Insurance and Occupational Pensions Authority called on insurance regulators to increase monitoring of the selection process insurers use to select money managers for pooled products.
EIOPA said in an opinion published Monday that it is concerned that insurers are choosing investment vehicles with unnecessarily high fees and other charges.
Insurance regulators are expected to be aware of consumer risks as a result of monetary incentive conflicts between managers and insurers that EIOPA identified in the European market. EIOPA said in the opinion that in result for consumers can be as poor investment outcomes, higher costs of retirement policies and unsuitable products.
Gabriel Bernardino, chairman of EIOPA, said in a news release: "The opinion addresses risks for consumers arising in the unit-linked market and sets out supervisory actions to ensure insurers act in accordance with the best interests of their customers. By clarifying supervisory expectations and providing guidance to the market, EIOPA aims for greater supervisory convergence which will result in better outcomes for consumers."