On May 14, 2019, the European Commission announced a formal antitrust investigation into Insurance Ireland’s data pooling system to reconcile its guidelines and conditions against competition laws that prevent unfair competitive disadvantages in the market.
Insurance Ireland operates and administers a data pooling system that is accessible and widely beneficial to its various member insurance producers and agents. Known as the Insurance Link database, the system works reciprocally – member companies contribute data and, in turn, have the ability to market competitively, detect potentially fraudulent behavior by claimants, and ensure accuracy of information. Access to pool data allows service providers to competitively price products.
The access guidelines and conditions, however, imposed may stifle non-member market operators to keep pace with Insurance Ireland members. This has been especially apparent in the auto-insurance industry, noted as an “essential” product by Commissioner Margrethe Vestager. The concern is that companies may be unfairly prevented from accessing the data pool, and thus are put at a disadvantage causing reduced options for consumers at competitive prices.
There is also a question of competition between members. Some elements of the data pool may reveal competitor marketing strategies, which would also curb competition. The Commission will be investigating the data pool system in light of European Union Competition Rules, which prohibits agreements between companies that “effect the prevention, restriction or distortion of competition within the internal market….” Art. 101 Treaty on the Functioning of the European Union (“TFEU”). There is no anticipated timeline for the investigation, and duration is expected to remain ongoing given the complexity of the matter. Ireland Insurance has taken a position of cooperation and confidence that its practices comply with the TFEU.