The Malta Financial Services Authority (MFSA) has published findings from two thematic reviews identifying weaknesses in product governance, cost transparency and customer outcome monitoring for unit-linked life insurance and non-life products distributed across borders. Insurers concerned are expected to assess their practices against the findings and supervisory expectations and take appropriate remedial action. Value for money assessments should cover the product lifecycle, from design and approval through distribution and ongoing monitoring. The unit-linked review covered four insurance providers, representing approximately 44.4% of unit-linked products offered by locally licensed undertakings. It found gaps in target market assessments, outdated or insufficiently transparent cost disclosures, and inconsistent monitoring of underlying investment funds. Some insurers lacked sufficient evidence of assessments covering break-even points and customer outcomes, including surrendered policies. Supervisory expectations include stronger value for money assessments at product level, clear and current disclosures, and documented monitoring of costs, investments and customer outcomes. The cross-border review examined travel, gadget, accident and health insurance, with particular attention to managing general agents. Weaknesses included gaps in product approval and review documentation, insufficient justification of some costs and commissions, and inadequate monitoring of claims and complaints. Insurers are expected to maintain effective oversight of products and distribution arrangements, justify cost and commission structures, and use claims and complaints data to identify and address emerging issues. The findings also highlighted the need to ensure policyholders understand their cover and exclusions.

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