Greatest risk to consumers “comes not from technological developments, but from the people in charge of the technology” – Director General Derville Rowland

24 October 2018 Press Release


  • Central Bank expects customers to be protected to the same high standard whether they are buying insurance from digital or traditional channels.
  • Concerns that technological advances could create specific challenges for the insurance sector.
  • New Innovation Hub engaging with Fintech in a more pro-active way.

In a speech today at the European Insurance Forum (EIF), Derville Rowland, Director General, Financial Conduct, set out the key conduct challenges the Central Bank has identified for the insurance industry during a period of rapid technological transformation.

Speaking at the EIF at Trinity College Dublin, she said:

“Insurance products are not visible in the way that other physical consumer goods are.  Because consumers cannot see or touch the product they are purchasing, it is difficult for them to understand whether it meets their needs now and in the future.  Any flaw may not surface for a number of years. This makes it all the more important that the professionals who do understand and sell the products, ensure that they meet consumers’ needs and expectations."

“The greatest risk to consumers comes not from technological developments, but from the people in charge of the technology. If you put new technology in the hands of people and firms who have the best interests of customers at heart, it is far more likely to result in positive consumer outcomes.”

“We are already very clear that we are technology neutral. By that I mean that we expect customers to be protected to the same high standard whether they are buying insurance from Alexa in the cloud or from Seán on the high street.”

She highlighted that new technology brings benefits including speed and convenience, greater choice in products and services, cheaper deals and more personalised products. But there were also concerns that technological advances potentially challenge the fundamental idea of insurance provision itself - the pooling of risk - as underwriting becomes more and more personalised through the use of data.

She added:

“Both traditional and digital sales channels can contain risk for consumers and both need to be managed.  Digital channels need to conform to the regulatory framework in the same way that is required of traditional ones so that customers interests are best served.’’

“From the perspective of conduct regulation, we want to make sure that consumers and investors are, and continue to be, protected irrespective of the technology they are using to engage with regulated firms. This means that the same principles of regulation, including the rules of the Consumer Protection Code, apply equally to both digital and traditional delivery channels.”

She concluded:

“As the nature of insurance business changes due to technological innovation, regulators also need to adapt their resources and activities to ensure that they understand these new developments and are in a position to regulate them in line with their respective mandates. In that regard, we have taken practical steps to ensure we are keeping pace with technological development in FinTech.

“The result is the Central Bank of Ireland’s Innovation Hub, which enables innovative firms to contact the Central Bank with questions on navigating the Irish regulatory landscape, and enhances our sight of where financial services are headed.”