On March 11, the IIF responded to EIOPA's consultation on sustainability claims and greenwashing in the insurance and pensions sector. In its response, the IIF encouraged EIOPA to align its definition of greenwashing with the more precise definition offered by the International Organization of Securities Commissions (IOSCO), which describes greenwashing as the practice of misrepresenting sustainability-related practices or the sustainability-related features of investment products. The IOSCO definition is better aligned with the potential source of greenwashing risk in the insurance sector – namely, with respect to insurance-based investment products.

The IIF also encouraged EIOPA to to take into account existing EU legislation that addresses a broad range of market conduct issues that are not greenwashing, including the Insurance Distribution Directive (IDD), EU regulations supplementing the IDD, and the EU Regulation on sustainability-related disclosures. These regulations provide national competent authorities with the basis to address market conduct issues that, while important, do not rise to the level of greenwashing.

Lastly, the IIF encouraged EIOPA to preserve insurers’ ability to design and price products based on risk. Insurers need to retain the ability to tailor their product offerings and pricing to account for new information and market signals and to provide market signals to their customers and the broader market and real economy. Decisions regarding product offerings and pricing directly impact the financial position and solvency of insurers and necessarily should remain business decisions. Supervisors are urged not to interfere in the business decisions of insurers unless necessary to prevent or address verified instances of consumer harm that are caused by unfair, discriminatory, or deceptive practices under the legal and regulatory framework in place in their jurisdiction.