LONDON: Insurers face stricter rules on selling products linked to the performance of stock or bond markets, in a bid to cut high costs for consumers, the European Union's insurance regulator said on Tuesday.

Insurers in the bloc collected premiums worth up to 340 billion euros ($404.33 billion) in 2019 from life insurance and pension premiums linked to the value of a stock, bond or property funds that cause the rates of return for investors to fluctuate.

The EU's European Insurance and Occupational Pensions Authority, or EIOPA, has repeatedly warned that the costs of some unit-linked products are too high, with many of the products too complex for their distributors to understand.

"Costs are often not clearly identified and they cannot be linked to a specific product component, making it difficult to assess the value of each component," EIOPA said in a statement.

EIOPA set out for public consultation the first, pan-EU framework for assessing whether unit-linked products offer value for money. The products account for a significant portion, over 2.8 trillion euros, of total assets under management in Europe.

"Existing concerns have been heightened by the COVID-19 crisis," EIOPA said.

"The low interest rate environment coupled to market shocks and the risk that households will need increased access to liquidity, underline how important it is that unit-linked products always offer value to consumers."

EIOPA said the new framework is a first step to further guidance for insurers and regulators in EU states for assessing when costs are too high and to test value for money.