The insurance sector could be on course for an overdue shake-up to combat surging renewal prices for loyal customers. The FCA (Financial Conduct Authority) have proposed changes that would effectively ban loyalty penalties, whereby some insurers offer cheaper deals to new customers than a renewing customer can access.
See more from the BBC: https://www.bbc.co.uk/news/business-54243383
According to the FCA, six million home and motor policyholders are paying on average £200 too much on premiums, totalling £1.2bn per year.
What has happened?
The FCA is proposing that when a customer renews their home or motor policy that they pay no more than they would if they were new to their provider when purchasing through the same channel.
If this reform comes in, it means that firms will be prevented from offering cheaper prices to new customers.
What does this mean for you?
It means nothing changes, yet. The FCA is seeking views on its proposals by January 2021. If all goes ahead, then it could result in people paying cheaper premiums at renewal for by outlawing price hikes based on loyalty. However, it may also remove some of the cheapest deals from the market as insurers look to minimise the financial impact of this. For our clients, we will continue our same approach of looking for the best deal for you, year in, year out.
What should you do now?
If your policy is due for renewal, it’s worth going with a broker who will protect your loyalty. Our team at Jukes Insurance Brokers will ensure you don’t get taken for granted. So, what makes us different?
- We contact you before renewal
We will never renew without getting in touch with you for your instructions. We work on your behalf and don’t make assumptions.
- We compare against our panel of insurers
A real human will take a look at your renewal and check that both price and cover are competitive with the rates we have available. We do this regardless of whether the customer is new or old to us.
- We’re transparent and offer independent advice
In the event of a claim, you want to be dealing with a team who cares. Our dedicated claims team are on-hand to support you with any claims enquiries giving you one less thing to worry about.
A lot of our customers are very loyal, so we felt it was right to respond to this news and offer our support to this new reform. We always treat our clients fairly and put them at the heart of everything we do.
If you’re concerned you may be overpaying for your insurance then get in touch with our team on 01527 874092.