Countdown to 1 April Changes Aimed at Helping Insurance Consumers Understand Their Options at Renewal

LONDON, March 22 -- The Association of British Insurers issued the following news release:

The countdown is on till the introduction, on 1 April, of important changes to give consumers a better understanding of their renewal premium and options when their retail insurance policies, such as motor and home insurance, come up for renewal.

The new rules, which the ABI first called for in 2014, are now coming into force through requirements from the Financial Conduct Authority. They will apply to anyone selling retail general insurance products, including insurers, brokers, banks and retailers. They will require firms in renewal communications to:

* Show the current premium (including any mid-term changes) alongside the renewal premium.

* Provide information to encourage customers to check their cover, and consider shopping around for the best deal.

* Identify those customers who have renewed with them on four consecutive occasions, and provide them with additional messaging on shopping around.

The ABI stresses that while price will be a factor, it is more important for consumers to check that the policy cover meets their needs. This is particularly important for policies such as health and pet insurance, where a claim made during the year, could mean that the same cover may not be available when shopping around. ABI's guide to help consumers at renewal is here.

James Bridge, ABI's Assistant Director, Head of Conduct Regulation, said:

"Many customers already shop around for the best insurance deals at renewal. These changes should help more people see if their renewal quote has changed, and to decide if they want to shop around. The ABI has long called for changes to be made by the regulator so that all customers, regardless of from whom they buy their insurance, benefit.

"Customers should always remember to choose the cover that meets their needs, and not simply buy on price alone.

"Industry initiatives, such as the Code for Vulnerable Customers at Renewal and ABI's publishing of claims acceptance rates, are improving transparency. They are helping give customers greater confidence in getting the right policy for their needs at a competitive price."

Notes for Editors

1. In July 2014 the ABI wrote to the FCA proposing compulsory disclosure of the current premium in renewal documents. In December 2015, the FCA started a consultation on this issue, which was completed in March 2016. In August the FCA issued a policy statement, setting out these changes to be implemented from 1 April 2017.

2. The Association of British Insurers is the leading trade association for insurers and providers of long term savings. Our 250 members include most household names and specialist providers who contribute GBP12bn in taxes and manage investments of GBP1.6 trillion.

3. An ISDN line is available for broadcast

4. More news and information from the ABI is available on our web site, www.abi.org.uk.

[Category: Insurance]

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