Dutch Authority for the Financial Markets finds 22 embedded insurance sales journeys steer consumers toward potentially unsuitable cover

The Dutch Authority for the Financial Markets has published research finding that online choice environments for embedded insurance often push consumers toward taking out cover that may not be suitable. The main risk is that consumers buy insurance linked to a product or service without receiving enough balanced information, including where the cover may overlap with existing policies and create overinsurance. The authority called on providers and platforms to design these journeys more carefully so consumers can make appropriate choices. The findings are based on observations of 22 online choice environments. Across these journeys, insurance was often made very easy to buy, presented prominently and repeatedly, and paired with a less visible or less accessible option not to insure. Many platforms also used behavioural prompts such as emphasis on certainty and protection, social proof such as most chosen, and time pressure during the purchase process. Information was typically layered in a way that left the top level sparse and the underlying material complex or hard to access, with benefits highlighted more clearly than limits, duration, costs and possible overlap with existing insurance. Although this review did not assess compliance with legal requirements, the authority said the way these choice environments are designed could lead providers or platforms to fall short of legal standards that it can enforce. Its report sets out further recommendations, including making information clear and accessible and presenting options in a balanced way.