Skip to main content

Which steps do life insurance undertakings need to undertake to reduce the gaps in Product Oversight and Governance (POG) arrangements?

The Commissariat aux Assurances (CAA) recently published an information note in response to the analysis of the answers to the qualitative questionnaire sent to life insurance undertakings in November 2022. The obtained results reveal compliance gaps in product oversight and governance (POG) arrangements, prompting the CAA to raise awareness among life insurance undertakings in this area for them to align their practices with the CAA’s expectations and to prepare for potential controls on their premises.

To help meeting those expectations, the CAA outlined five areas life insurance undertakings should put their focus on:


1) The target market: Most market players could be more specific about their definition of target markets. Although optional in Luxembourg, the CAA strongly recommends defining a negative target market to ensure effective commercialization.

2) Product testing: It's important for life insurance product manufacturers to test life insurance products before commercializing them, to make sure they bring added value to the identified target market they have been designed for.

3) Product follow-up and review: Even after a product is on the market, it's crucial to re-examine its adequacy to ensure it still meets the needs of its target market overtime. If not, adjustments to the products and / or to the target market are required for pursuing commercialization.

4) Distribution channels: The CAA also emphasizes that life insurance products manufacturers are responsible for verifying that distributors adhere to the distribution strategy they had defined.

5) Conflicts of interests: The CAA observed compliance discrepancies regarding the management of conflicts of interests by life insurance undertakings. Some of these observations are directly linked to the latest concept of "value for money" (universe of recommended funds, retrocessions), which requires regular analyses.

How can Deloitte help?


Based on the concrete observations of the CAA within this publication and based on our experience in helping life insurance undertakings and distributors comply with the Insurance Distribution Directive (IDD), we propose to support you in performing a maturity assessment of your POG compliance with the above aspects. This assessment would identify gaps between your implementation of POG and the CAA’s expectations for creating an action plan to achieve your desired level of compliance ahead of any future on-site inspections.

If you have any questions, do not hesitate to contact us. We are at your disposal if you require further assistance.

Did you find this useful?

Thanks for your feedback

If you would like to help improve further, please complete a 3-minute survey