Since 1st January this year, new rules have come into effect, to provide greater protection for loyal and vulnerable home and motor insurance customers.
The new rules, which have been introduced by the FCA, state that any person who renews an existing policy won’t need to pay any more than a brand new customer would. Essentially, customers who tend to remain with the same insurance companies won’t be affected, but for those who like to switch up their providers, it could mean a price hike.
What does the FCA believe?
In reality, many people believe that their insurer will automatically reward loyalty, but the FCA believe that is not what happens in many cases. Not all, I hasten to add! However, the FCA principles of treating customers fairly adds a powerful narrative around customer engagement, hence the need for change.
It is thought that this change will save customers £4.2 billion over ten years. These rule changes follow pressure from Citizens Advice complaints, and are a bid to avoid the phenomenon known as “price walking”.
Matthew Upton, director of policy at Citizens Advice, said: “Rip-off renewal prices have seen consumers paying over the odds for far too long. No longer can you be exploited just for staying loyal.”
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Eddie works with a highly skilled team to deliver industry specific advice to the asset finance and leasing sector.