I am aware of the reports referred to by the Deputy, which my Department has brought to the attention of the Financial Regulator. Under the Life Assurance (Provision of Information) Regulations 2001, a customer buying a life assurance product must receive information on the commission payable. The objective is to ensure that the customer is aware of the amount of commission payable, to whom it is payable and the effect of charges on the performance of their product. This means that the customer is able to opt out of the particular contract and/or to shop around for a better deal, either from another insurance company or from another intermediary. Where there is evidence that a financial institution, such as an insurance company, is not meeting its obligations in making customers aware of commissions charged, the Financial Regulator has the power to investigate. The Financial Regulator has also issued a Consumer Guide to Life Insurance which is available on www.itsyourmoney.ie. If individual customers believe they were not properly informed about the commission they have paid, they can refer the complaint to the Financial Services Ombudsman.
It is open to an insurance company to arrange a commission in respect of sales irrespective of the distribution channel used, i.e. a broker or employee. In general, the Financial Regulator has no role or powers in setting the charges or price of investment products. However, in the case of products for pension purposes, the maximum charges on standard PRSAs cannot exceed 5% of contributions paid and 1% of the PRSA assets.
If the Deputy considers that commissions are being inappropriately charged in any specific instances, she should bring the matter to the attention of the Financial Regulator.