The new EU Directive on insurance mediation is causing headaches. Only this week a classic European bureaucratic cock-up highlighted the confusion surrounding the directive.

A Biba representative contacted us, asking if we knew the definitive answer to a clause in the professional requirements section. We had said intermediaries would be advised to hold financial capacity amounting, on a permanent basis, to 8% of the annual net retained revenue. But Biba found another version, which said the amount could be 4% of the sum of annual premiums received.

Biba decided to talk to the EC parliamentary press office that issued the directive. It did not know the answer and referred Biba to the author in Brussels. He admitted he had no idea and had not even written that part of the directive. "Speak to Manuel who did," was his advice.

Biba then tracked down Manuel, who at first wasn't sure if he had written it, but finally said 4% was the new figure. However, intermediaries don't have to comply with that clause, but can choose one of four. The proposal may change again. Backchat won't hold his breath.