EC proposals for liability framework could increase legal uncertainty and reduce affordability and availability of insurance cover


Insurance Europe has published a set of key messages on both the European Commission’s proposal for a revision of the Product Liability Directive (PLD), and its proposal for the Artificial Intelligence (AI) Liability Directive.

The insurance industry supports the Commission’s efforts to bring the legislative framework for product liability in line with market realities. However, the Commission’s proposals will likely not contribute to the intended objective of increased peace of mind for consumers.

For insurers to continue to provide the protection and coverage their policyholders need and expect, the Commission’s proposals would require significant refinements. These would include increasing legal certainty and clarifying the scope and certain other concepts and definitions introduced in the proposals. In this regard, it will be important to avoid unnecessary changes and overlaps with existing rules and regulations.

The insurance industry fears that the frameworks, as proposed by the Commission, would increase the burden on producers in a disproportionate manner, while not increasing consumer protection. Not only will this lead to litigation in an excessive number of cases; it is also likely to impact the affordability and availability of insurance cover.