The Financial Conduct Authority (FCA) explained that as customers’ risk profiles may have changed because of the coronavirus, firms should consider whether they should be offering customers less expensive products or else revising coverage to ensure that customers have products that better meet their needs.
Customers who are struggling to make their payments due to financial implications brought about by Covid-19 are advised to contact their insurer or insurance broker to discuss their options. As per the new rules, customers can request a payment deferral at any point during the period up to 18 August, while the window is open. And this deferral can be granted for a period of between one and three months, although firms can take it beyond three months.
Where this is not considered appropriate, the FCA states that firms should offer customers other forms of relief such as accepting reduced repayments, or rescheduling the terms, waiving missed or late payment fees or allowing a customer to amend their repayment date without any cost.
Sheldon Mills, Interim Executive Director of Strategy and Competition at the FCA, said: “Many firms in the insurance industry have already taken some of the actions we are suggesting here to support customers, such as premium reductions, discounts, waiving fees, and payment deferrals. The measures confirmed today will provide urgent support to those that need it.”