Digital Fairness Act: Why It Matters for Financial and Insurance Services

A major new piece of EU consumer legislation is on the horizon.

The Digital Fairness Act could reshape how digital services interact with consumers, and its reach will extend to financial services and insurance.

Now is the time to understand what is coming and how it could affect your business.

A New EU Initiative on Digital Fairness

Exactly a year ago, Ursula von der Leyen, President of the European Commission, tasked Michael McGrath, Commissioner-designate for Democracy, Justice, and the Rule of Law, with developing a Digital Fairness Act.

In her mission letter, she wrote:

“I would like you to focus on the impact and opportunities of digital technologies on consumers and our justice system. You will develop a Digital Fairness Act to tackle unethical techniques and commercial practices related to dark patterns, marketing by social media influencers, the addictive design of digital products, and online profiling, especially when consumer vulnerabilities are exploited for commercial purposes.”

This marked the start of a significant new initiative with potential implications across all sectors, including financial services and insurance.

How We Got Here

The Digital Fairness Act builds on several earlier steps by the European Commission:

• 2020: The New Consumer Agenda announced plans to examine whether extra measures were needed to ensure fairness online and offline.
• 2022: The Commission launched a Fitness Check of EU consumer law on digital fairness to evaluate whether existing rules remain fit for purpose in the digital environment.
• October 2024: The Commission published a Staff Working Document setting out the conclusions of this Fitness Check.

The Fitness Check found gaps in consumer protection online and highlighted a range of harmful and evolving practices that need to be addressed.

What the Fitness Check Found

The Fitness Check evaluated three core directives:

• Unfair Commercial Practices Directive
• Consumer Rights Directive
• Unfair Contract Terms Directive

It concluded that these rules are still relevant and essential for protecting consumers and supporting the Digital Single Market.

However, it also pointed to areas needing improvement. Specifically, it called for stronger action against:

• dark patterns
• misleading marketing by influencers
• addictive design of digital products
• unfair personalisation practices

It also recommended:

• preventing regulatory fragmentation
• ensuring consistent application of EU consumer law and the broader EU digital rulebook
• enabling more effective enforcement
• simplifying rules without weakening consumer protections

This evaluation was supported by a Call for Evidence, a public consultation, and an external study.

Why It Matters for Financial and Insurance Services

EU consumer protection rules are sector-agnostic, which means the Digital Fairness Act will also affect financial services providers, including insurers and intermediaries.

The proposal intersects with existing financial regulation and touches on several emerging issues:

• the role of Finfluencers
• use of dark patterns in digital channels
• personalised pricing and profiling practices

These are complex areas that policymakers, supervisors, and academics are still exploring, and they go to the heart of building and maintaining consumer trust in financial and insurance services.

What Happens Next

Based on the Fitness Check, the upcoming Digital Fairness Act is expected to:

• tackle unfair commercial practices
• ensure a level playing field for online traders
• facilitate enforcement
• simplify existing rules

The Public Consultation is still open, and your feedback can help shape how this initiative develops.

Bottom line: This is not just about consumer protection. It is about trust, fairness, and creating a safer digital environment for everyone, including customers of financial and insurance services.

How I Can Help

If you would like to stay ahead of how the Digital Fairness Act could impact financial and insurance services, I can help you monitor its development and assess its implications for your business.

Contact me if you would like tailored insights and support.