FCA warns insurers failing renewal rules
The UK Financial Conduct Authority (FCA) has warned that it will take action against insurance companies that are failing to properly implement transparency rules.
Introduced in April 2017, the new legislation requires that insurers show the insurance premium a customer paid last year alongside their proposed renewal premium, whilst also showing a ‘prominent, clear and straightforward message’ to encourage customers to find the best deal for themselves. Despite warning firms in October, the FCA said that firms are still failing to meet these rules.
Jonathan Davidson, Executive Director of Supervision of Retail and Authorisations at the FCA said:
“It is simply unacceptable to see that some firms are still not being properly transparent with their customers a year on from the introduction of the rules. Firms failing to get this right may have led to consumers losing out as they do not have the right information to decide whether or not to shop around.”
RAC is one of the companies that the FCA says that it found to be failing to meet expectations, and the company was made to contact all affected customers.
“We have already acted where we have seen particularly poor practice in firms and will continue to do so where we see firms not being transparent,” said Davidson. “As we said in October, we expect other firms to take notice of these issues, to look at what they are doing and to make sure they are getting it right.”
The FCA has said that it expects firms and senior management in those firms to take immediate action to ensure they are compliant.