Insurance policy on minimum monetary amount of the professional indemnity insurance of PSD2

Guideline 1.4 of the EBA Guidelines on the criteria on how to stipulate the minimum monetary amount of the professional indemnity insurance (PII) or other comparable guarantee under Article 5(4) of Directive (EU) 2015/2366 (PSD2) prescribes that ‘the minimum monetary amount of the PII or comparable guarantee allows undertakings to effectively meet their liabilities in relation to their activities by verifying that the PII or comparable guarantee does not have any excess, deductible or any threshold that could prejudice repayments resulting from the requests for refunds of payment service users and account servicing payment service providers (ASPSPs) and is valid when the liability occurs’. Guideline 1.3 further specifies that the minimum monetary amount of the PII or comparable guarantee, should cover costs and expenses incurred by payment service users and ASPSPs who request undertakings to refund losses resulting from one or more of the liabilities referred to in Article 5(2) and (3) of PSD2. In relation to the above, the PII or the comparable guarantee should cover the potential costs and expenses that may be incurred by all payment service users of the third party provider (TPP) and ASPSPs resulting from one or more of the liabilities that are referred in Article 5(2) and (3) of PSD2. Where the amount of the cover, has any excess, deductible or any threshold whatsoever, these should not prejudice repayments to payment service users and/or ASPSPs and should be covered by any safeguards the TPP may have put in place, such as a deposit that can be withdrawn within certain conditions, an additional insurance or another comparable guarantee.