The Association of British Insurers (ABI) has written to the Financial Conduct Authority (FCA) to propose an initiative it believes could further improve clarity for customers when renewing and taking out motor and home insurance.
The proposal builds on the work the FCA has already started in this area. The regulatory initiative proposed by the ABI would be a new minimum standard of information applying across the market that, if adopted, all customers would receive when renewing their private motor and home insurance:
- Renewal documents for motor and home buildings and contents insurance should include the premium that the customer started the year paying alongside the renewal quote for easy comparison, and
- Policy documents for new customers should include a clear explanation that any introductory discounts which may have applied to new customers may not apply when the policy is due for renewal.
Huw Evans, deputy director general of the Association of British Insurers, said: “Insurers want to make renewing your insurance policy easier and clearer to understand by reminding you of last year’s premium and flagging up introductory discounts.
“Most of us have home or car insurance and it is important we have the information we need when it comes to renewal.
“Our proposal, if adopted by the FCA across the market, would significantly improve transparency for millions of customers. We look forward to discussing it in detail with the FCA.”
Andy Watson, CEO of Ageas UK, said: “Ageas is supportive of the ABI proposals to ensure pricing is clear for customers. We agree that documentation should be transparent on pricing and discounts applied so that customers are able to understand annual changes in their premiums.
“However, as a market we must move as one and at the same time in order to achieve real customer benefit and this proposal highlights the need for insurers, brokers and other suppliers to work together to implement any change.”
