The Association of British Insurers (ABI) has lent it’s support to a call for car insurers to be more upfront with price information on renewal notices.
The proposal is that insurers have to include previous price information on renewal notices, so that it would be as easy as possible for customers to see any change in their premium – whether the price has gone up or down, or stayed the same.
The Financial Conduct Authority (FCA) have warned that they’re concerned customers are being punished, rather than rewarded, for loyalty to their insurers, and that it was not obvious enough to them that they often ended up paying more than previous years.
A trial in 2014 found that including the previous year’s premium in a renewal notice prompted between 11% and 18% more of those on the trial to switch provider or negotiate a cheaper premium – so it’s clearly a win for consumers.
Huw Evans, director general of the ABI, said: “Publishing last year’s price alongside the renewal quote up front is a good idea which insurers themselves proposed to the FCA last year. This will help customers and encourage them to engage with the policy they choose and what they get for their money. It will take time to implement such a big change across the whole insurance industry and we will work closely with the FCA to ensure this welcome reform is delivered on a realistic timescale”.
The ABI seek to make things easier for drivers, and have also leant their support to liftsharing.
Do you renew without checking your previous premiums, or do you shop around?
Author Lex Barber