This page is part of the overview of Court of Justice insurance case law. It collects 11 judgments of the Court of Justice of the European Union on this topic, in chronological order, with a short synthesis. The summaries are written in our own words. Citation conventions, links and temporal application are explained on the overview page.
Synthesis
The VAT Directive 2006/112/EC (formerly the Sixth Directive 77/388/EEC) exempts insurance and reinsurance transactions and related services performed by insurance brokers and agents (Article 135(1)(a)). The Court construes the exemption strictly, but an 'insurance transaction' does not require the supplier to be an insurer (CPP, BGŻ Leasing, Mapfre asistencia). Administrative, claims handling and assessment services supplied to insurers are not services related to mediation (Taksatorringen, Arthur Andersen, Aspiro, Q-GmbH). The cases matter for outsourced claims handling, warranty products and add-on insurance; indirect taxes on premiums are governed by the law of the Member State of the risk (A). In Estonia see the VAT Act's exemption for insurance transactions.
Judgments
CJEU 25.02.1999, C-349/96, Card Protection Plan (CPP)
Preliminary ruling, Sixth Chamber · ECLI:EU:C:1999:93 · para 36; operative part, point 1 · Sixth Directive 77/388/EEC Art 13B(a); insurance transaction; block policy; single or multiple supply
In the United Kingdom a company offered cardholders a protection plan, procuring the insurance cover from an insurer under a block policy it held. The Court held that a taxable person who is not an insurer but procures insurance cover for its customers as holder of a block policy performs an insurance transaction, and that a Member State may not restrict the exemption to authorised insurers (para 36). The national court had to assess whether there was a single supply or several.
CJEU 08.03.2001, C-240/99, Skandia
Preliminary ruling, First Chamber · ECLI:EU:C:2001:140 · para 44 · Sixth Directive 77/388/EEC Art 13B(a); insurer's services to a subsidiary
In Sweden an insurer undertook, for market-rate remuneration, to carry on the business of its wholly owned insurance subsidiary, which continued to conclude contracts in its own name. The Court held that such an undertaking is not an insurance transaction, since the supplier does not assume the insurance risk. Intra-group administrative services are therefore generally subject to VAT.
CJEU 20.11.2003, C-8/01, Assurandør-Societetet (Taksatorringen)
Preliminary ruling, Fifth Chamber · ECLI:EU:C:2003:621 · paras 46, 65 · Sixth Directive 77/388/EEC Art 13B(a) and Art 13A(1)(f); damage assessment; independent groups of persons
In Denmark an association of insurers assessed vehicle damage on behalf of its members. The Court held that such assessments are neither insurance transactions nor related services performed by brokers or agents (para 46), and that the exemption for independent groups of persons must be refused where there is a genuine risk of distortion of competition (para 65). Relevant to the VAT treatment of jointly organised claims assessment.
Later limitation: in Aviva (C-605/15, 21 September 2017), the Court held that the cost-sharing exemption in Article 132(1)(f) of Directive 2006/112 does not cover services supplied by groups whose members operate in the insurance sector. Taksatorringen's competition-distortion test therefore cannot be used as a general exemption for the insurance sector today. For earlier tax periods, the limitations concerning legal certainty, retroactive effects and reliance on a directive against an individual explained in paragraphs 35–38 of Aviva must be considered.
CJEU 03.03.2005, C-472/03, Arthur Andersen
Preliminary ruling, First Chamber · ECLI:EU:C:2005:135 · para 39 · Sixth Directive 77/388/EEC Art 13B(a); back-office services; services of an insurance agent
In the Netherlands a company provided back-office services, including policy administration, to an insurer for remuneration. The Court held that such services are not services related to insurance transactions performed by an insurance broker or agent, since they lack the relationship with both insurer and insured characteristic of mediation. Outsourced administration is therefore taxable.
CJEU 17.01.2013, C-224/11, BGŻ Leasing
Preliminary ruling, Sixth Chamber · ECLI:EU:C:2013:15 · paras 50, 61, 70 · Directive 2006/112/EC Art 135(1)(a); leasing and insurance of the leased asset; single or multiple supply
In Poland the lessor insured the leased asset and invoiced the lessee separately for the insurance. The Court held that the leasing service and the insurance of the asset are, in principle, separate supplies, and that where the lessor itself insures the asset and recharges the exact cost to the lessee, this is an exempt insurance transaction. Relevant to the VAT treatment of insurance sold with leasing, credit and other financial products.
CJEU 16.07.2015, C-584/13, Mapfre asistencia
Preliminary ruling, Fifth Chamber · ECLI:EU:C:2015:488 · para 58 · Sixth Directive 77/388/EEC Art 13B(a); used car warranty; insurance transaction
In France an undertaking independent of the used car dealer provided, for a fixed price, a warranty against mechanical breakdown of the vehicle. The Court held that such a service is an exempt insurance transaction and must in principle be treated as separate from the sale of the car. Relevant to classifying extended warranties and breakdown cover as insurance.
CJEU 17.03.2016, C-40/15, Aspiro
Preliminary ruling, First Chamber · ECLI:EU:C:2016:172 · para 45 · Directive 2006/112/EC Art 135(1)(a); outsourced claims handling
In Poland a third party handled claims in the name and on behalf of an insurer. The Court held that such claims handling services are not covered by the exemption for insurance transactions and related services, since the supplier is neither an intermediary nor bears the insurance risk. Outsourced claims handling is therefore subject to VAT.
CJEU 17.01.2019, C-74/18, A (Member State of the risk)
Preliminary ruling, Sixth Chamber · ECLI:EU:C:2019:33 · para 43 · Directive 2009/138/EC (Solvency II) Art 13(13) and Art 157; Member State of the risk; indirect taxes on premiums
An insurer established in one Member State covered the risks of a company in another Member State linked to the value of shares and the fair purchase price paid in a corporate transaction. The Court held that only the indirect taxes and parafiscal charges of the Member State where the policyholder is established apply to such a contract. Relevant to the taxation of warranty and indemnity (W&I) and other financial risk insurance.
CJEU 08.10.2020, C-235/19, United Biscuits
Preliminary ruling, First Chamber · ECLI:EU:C:2020:801 · para 51 · Directive 2006/112/EC Art 135(1)(a); pension fund investment management; concept of insurance transaction
In the United Kingdom investment managers provided services to the trustee of an employer's pension scheme without any indemnity element. The Court held that such services cannot be classified as insurance transactions and are not covered by the insurance exemption; what matters is the assumption of risk and payment on occurrence of the insured event. The ruling clarifies the boundaries of an insurance transaction.
CJEU 25.03.2021, C-907/19, Q-GmbH
Preliminary ruling, First Chamber · ECLI:EU:C:2021:237 · para 44 · Directive 2006/112/EC Art 135(1)(a); development of an insurance product; mediation; single supply
In Germany a company developed an insurance product, made it available to an insurer and, as ancillary activities, mediated and administered contracts on the insurer's behalf. The Court held that if the national court treats these services as a single supply, the exemption does not apply, since its predominant element is not insurance mediation. Relevant to the VAT treatment of MGA-type product development and administration services.
CJEU 09.03.2023, C-42/22, Generali Seguros
Preliminary ruling, Ninth Chamber · ECLI:EU:C:2023:183 · paras 46, 51 · Directive 2006/112/EC Art 135(1)(a) and Art 136(a); sale of salvage from damaged vehicles
In Portugal an insurer bought from policyholders the remains of vehicles damaged in insured events and resold them to third parties. The Court held that such transactions are covered neither by the insurance exemption (para 46) nor by the exemption for goods used solely for exempt activities (para 51). Relevant to the VAT treatment of insurers' salvage sales.