A few personal updates before we get into this week's analysis. Since the last edition, I launched andreslehtmets.com, bringing together everything I do in one place: regulatory strategy, policy design, research, speaking and my weekly newsletter. With the website project behind me, I want to spend more time on deeper writing and analysis. You will see more of that here and on the blog.

I also recently completed an EBRD-financed advisory project for SEDDK, the Turkish insurance supervisory authority, on digitalising insurance supervision. The closing event took place on 4 February in Istanbul, hosted by the Turkish Insurance Association. We delivered a diagnostic of SEDDK's digital maturity, a mapping of international SupTech practices against local needs and a set of practical recommendations. Grateful to the EBRD and SEDDK teams for the trust and cooperation throughout.

One housekeeping note: I am in the process of migrating the newsletter to a new email domain. For now you will still receive it from the old address. If things look slightly different, do not worry, it is still me.

This was a busy few weeks. Questions on whether ChatGPT qualifies as an insurance distributor. Plaid raised at $8 billion and insurance is part of the plan. The FCA published its new insurance priorities. And I have been writing more than usual on the blog, including a longer piece on why financial services needs to stop thinking in products.

If you find this useful, forward it to a colleague who works in financial regulation or digital finance. It takes 10 seconds and helps this newsletter reach the people who need it.

Is ChatGPT an Insurance Distributor in the EU?

Two things happened that put this question on the table.

First, Nippon Life sued OpenAI for $10.3 million. A disability claimant had uploaded correspondence from her lawyer into ChatGPT. The AI validated her concerns, she fired her lawyer, then used ChatGPT to file a new case and dozens of motions that the insurer says were drafted by the chatbot. No licence. No accountability. The insurer had no idea until it was back in court.

That was the US. But the question is now being raised formally in Europe.

EIOPA Q&A 3407, submitted in August 2025, has been forwarded to the European Commission. It asks directly whether publicly accessible AI chatbots fall within the scope of insurance distribution under the Insurance Distribution Directive (IDD). This builds on EIOPA's earlier Q&A 3168, which concluded that comparison websites requiring personal information and suggesting specific products qualify as insurance distribution.

The person who submitted the question tested it in practice. They describe interactions where AI chatbots provided detailed offers for specific insurance products from specific companies, and in some cases recommended coverage levels based on personal data and financial constraints. That is not a hypothetical.

The IDD was built for brokers, agents and bancassurance. It was written before the digitalisation era, and in my view it has navigated that transition quite well, largely because the definitions were drafted in a technology-neutral way. But it was not built for general-purpose AI tools used by hundreds of millions of people that can, in certain conversations, do what a regulated intermediary does.

I will be watching the Commission's response very closely.

Read the full analysis here and the Nippon Life piece here.

Plaid Hits $8 Billion. Insurance Is Part of the Story.

Plaid just raised new capital at an $8 billion valuation. Most coverage focuses on banking connectivity and payments. What gets less attention is that insurance is becoming a visible part of Plaid's strategy: a dedicated insurance page, a head of insurance and a product suite covering premium collection, underwriting with consumer-permissioned bank data and fraud prevention.

The FICO partnership announced in November 2025 is the one to watch. The new UltraFICO Score combines traditional credit data with real-time cash flow data from Plaid's network of 12,000+ financial institutions. When this kind of scoring reaches insurance pricing, it could change how carriers evaluate risk.

Plaid operates primarily in the US, but consumer-permissioned financial data flowing from banking into insurance is exactly what FiDA is designed to enable in Europe. The companies that figure out how to use open finance data for underwriting, while staying on the right side of regulation, will have a competitive edge on both sides of the Atlantic.

Read the full analysis here.

The FCA Just Published Its 2026 Insurance Regulatory Priorities

The UK Financial Conduct Authority published its first annual Regulatory Priorities report for the insurance sector on 24 February. Four things stand out:

1. AI in insurance gets a proper review. The FCA will examine how firms are using it across underwriting, claims and consumer services. They have an AI Lab and are encouraging firms to test ideas in it.
2. Cyber insurance. A focused review is underway, looking at risks, opportunities and barriers to purchase.
3. Captive insurance gets its own regulatory framework. A joint FCA and PRA consultation is expected in Q3 2026.
4. The future of insurance products. From Q3 2026, the FCA wants to sit down with industry and discuss what products consumers and businesses will actually need, and what regulatory barriers are getting in the way.

The London Market has doubled in size over the last decade and now contributes £61 billion to UK GDP. The FCA is signalling that innovation and growth are part of its mandate, not just consumer protection.

Read the full report here.

The Digital Fairness Act: Why Financial Services Should Pay Attention Now

The EU is working on something called the Digital Fairness Act. Most people in financial services have not noticed yet. They should.

It is not a regulation yet. But the direction is clear: dark patterns, addictive design, manipulative personalisation and subscription traps are all on the table. The Commission's evidence base already shows 75.7% of websites and apps use at least one dark pattern.

If you sell financial products through digital channels, this will eventually land on your desk.

I have spent weeks going through the public consultation results, the fitness check findings and the links to existing EU regulation. The result is a briefing that maps what the Commission is signalling to what it means in practice for financial services. Not a legal text. A practical guide for people who would rather prepare early than react late.

I´m finalising it now. Read more here.

From the Blog

A few things I published since the last edition:

The Financial Sherpa: Why the Future of Finance Is Not a Product. Financial services is organised around products, but people think in life events. I use the Sherpa analogy to argue for a lifecycle model where banking, insurance, pensions and investment work as one integrated companion, not four separate sales channels. FiDA is the regulatory infrastructure that could make this possible. Read it here.

Reframing Risk: What Vanguard's Research Means for the Savings and Investment Union. Vanguard rewrote standard risk disclosures and reduced customer drop-off by 23%. Same regulatory substance, same warnings, just written for humans. The rewritten version increased confidence to invest from 46% to 62%. If the Savings and Investment Union is serious about getting more Europeans to invest, this evidence matters. Read it here.

Estonia Is Making AI Feasibility Assessment Mandatory in Its Legislative Process. Not a strategy document. An amendment to the procedural rules that civil servants follow when drafting laws. Every new legislative initiative must now be assessed for AI and automation potential. Takes effect 1 May 2026. A small change that could be genuinely systemic. Read it here.

£43 Billion: What the UK's Open Banking Numbers Mean for the Open Finance Debate. New EY analysis for Open Banking Limited puts a number on the economic value: £8.3 billion already delivered, £43 billion at full maturity. Important context as FiDA discussions continue in Brussels. Read it here.

Quick Links

80% of adults now have a bank account, but access without protection is a trap. A new OECD/G20 paper examines the tension between financial access and consumer protection. Mobile money, open finance and AI have expanded access, especially in emerging markets, but the same tools introduce algorithmic bias, digital exclusion and credit products quietly driving over-indebtedness. Worth reading if you work on inclusion policy. Read more here.

EU-UK Financial Regulatory Forum on operational resilience. The fifth Joint EU-UK Financial Regulatory Forum convened on 11 March in London, bringing together the Bank of England, FCA, ECB and all three European Supervisory Authorities. Key topics: cybersecurity, operational resilience and macroeconomic stability risks. Post-DORA, this cross-border coordination matters. Read more here.

Number of the Week

75.7%

That is the share of websites and apps in the EU that use at least one dark pattern, according to the European Commission's evidence base for the Digital Fairness Act. Three quarters. If your digital distribution channel is not already reviewing its design choices, the regulatory conversation is about to make it unavoidable. Are we ready?

Get in Touch

If any of this week's topics touch your work, I am happy to talk. I advise regulators, financial institutions and fintechs on open finance, AI governance, regulatory strategy and supervisory digitalisation. See my services or reach me at andres@andreslehtmets.com.

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