The Freedom of Services (FOS) Policy: The Five W’s
What is a FOS Policy?
A policy issued in one EU member state to cover a
risk located in another EU member state permitted
as part of the Second and Third EU Non-Life
Insurance Directives (1988 & 1992). The form
issued is usually the issuing country’s standard
domestic form which is not designed for use
outside of the issuing country’s territory.
Who issues a FOS Policy
An insurer incorporated in a European Union (EU)
member state.
Where is a FOS Policy Available?
In the EU member states plus 3 EEA (European
Economic Area) territories (Iceland, Liechtenstein
and Norway).
When should a FOS policy be used and Why?
Good question! Read on to determine the best
answer for your clients’ specific needs.
With the evolution of a united Europe, the concept
of a FOS policy sounds good to begin with: one
policy covering multiple countries satisfying the
admitted requirement in each jurisdiction. An
uncomplicated approach for covering multiple
exposures! Unfortunately, the idea preceded the
infrastructure needed to make it truly a success.
For example, the insured usually misses out on
unique and/or compulsory covers available in the
local market that cannot be replicated under a FOS
policy. Also, with the increasing awareness of tax
compliance, calculating and remitting taxes in each
member state is challenging to say the least.
While Chubb has the capability to issue a FOS
policy insuring most countries where FOS is
permissible, we typically recommend a Controlled
Master Program. Under this approach, we issue a
master policy to the parent company or first named
insured in the insured’s home country and then
issue locally admitted policies in each country
where the insured has physical operations. This
way the local insured benefits from the local
consultation and services provided by the local
carrier and agent as well as obtaining the country’s
“good local standard” policy which includes any
local unique coverage provisions or compulsory
requirements.
It should be noted that Chubb can issue locally
admitted property and casualty policies in most EU
countries; however, in specialty lines of business
the FOS may extend to some countries where
Chubb cannot issue a local professional liability
contract.
Page 1 of 2
This document is advisory in nature. Actual coverage is subject to the language of the policies as issued. Nothing herein obligates Chubb to provide a
quote letter, binder or issue a policy. The information provided should not be relied on as legal or insurance advice or a definitive statement of the law in
any jurisdiction. For such advice, an applicant, insured, listener or reader should consult their own legal counsel or insurance consultant. No liability is
assumed by reason of the information this document contains. Chubb refers to the member insurers of the Chubb Group of Insurance Companies. Not
all insurers do business in all jurisdictions.
Before offering a FOS policy to your client, weigh the pros and cons. They will lead you to the best
solution!
PROS
CONS
9 Ease of issuance
8
No unique/compulsory covers
9 One policy for multiple countries
8
Written in issuing country’s language
9 Centralized control
8
Lack of involvement/understanding by local
insured
8
No local consulting/services by local carrier or
agent
8
May not be in compliance with a country’s
insurance regulations
Please contact your local Chubb underwriter for more information.
Page 2 of 2
This document is advisory in nature. Actual coverage is subject to the language of the policies as issued. Nothing herein obligates Chubb to provide a
quote letter, binder or issue a policy. The information provided should not be relied on as legal or insurance advice or a definitive statement of the law in
any jurisdiction. For such advice, an applicant, insured, listener or reader should consult their own legal counsel or insurance consultant. No liability is
assumed by reason of the information this document contains. Chubb refers to the member insurers of the Chubb Group of Insurance Companies. Not
all insurers do business in all jurisdictions.