The answer to this question is provided by the European Commission.

The definition of ‘insurance distribution’ in Article 2(1)(1) of the Directive (EU) 2016/97 includes not only ‘the activities of advising on, proposing, or carrying out other work preparatory to the conclusion of contracts of insurance, of concluding such contracts’ but also ‘assisting in the administration and performance of such contracts, in particular in the event of a claim’. This is intended to cover, for instance, situations where the claims' handling activity is part of assisting a customer in the contract performance.

Article 2 paragraph (2) IDD specifies the activities which must not be considered insurance distribution activities under the definition in Article 2(1)(1). Such activities include ‘the management of claims of an insurance undertaking or of a reinsurance undertaking on a professional basis, and loss adjusting and expert appraisal of claims’ (Article 2(2)(b) IDD). Recital 14 IDD further clarifies that the IDD should not apply to persons with another professional activity, such as tax experts, accountants and lawyers who provide advice on insurance cover on an incidental basis in the course of that other professional activity provided that the purpose of this activity is not to help the customer conclude or fulfil an insurance contract.

The purpose of the exclusion under Article 2(2)(b) IDD for professional claims management is therefore to exclude service providers which, on a permanent basis, have a professional activity consisting solely of claims management, loss adjusting and expert appraising of claims, as they are considered, for this purpose, as an activity separate from insurance distribution.

It follows that the activities consisting solely of claims management on a professional basis, loss adjusting and expert appraisal of claims undertaken by operators performed by third party providers are excluded from the scope of the IDD (Article 2(2)(b) IDD). Such activities are not to be considered as ‘assisting in the administration and performance of insurance contracts’ within the meaning of the definition of insurance distribution under Article 2(1)(1) IDD.  

Disclaimer provided by the European Commission:

The answers clarify provisions already contained in the applicable legislation. They do not extend in any way the rights and obligations deriving from such legislation nor do they introduce any additional requirements for the concerned operators and competent authorities. The answers are merely intended to assist natural or legal persons, including competent authorities and Union institutions and bodies, in clarifying the application or implementation of the relevant legal provisions. Only the Court of Justice of the European Union is competent to authoritatively interpret Union law. The views expressed in the internal Commission Decision cannot prejudge the position that the European Commission might take before the Union and national courts.