FCA to clamp down on insurance 'loyalty penalties'
The UK financial regulator, the Financial Services Authority (FCA), has said it will put in place measures to stop home insurance firms penalising loyal customers.
The new measures were outlined in the organisation's Sector Views, which focuses on key concerns over the coming year. The FCA said clients who stay with their existing insurer at renewal invariably pay higher premiums than those who switch or negotiate.
The FCA said: "Some of the highest-risk products are often marketed directly to retail consumers with poor communication of the risks involved and implications that the investments are regulated, when this is not the case."
Sector Views is produced annually by the FCA to identify areas it will need to address in any given year. Among concerns listed in this year's report are Brexit and data usage.
Christopher Woolard, who was appointed executive director of strategy and competition at the FCA and interim chief executive in January, explained: "We are committed to reducing harm in the markets we regulate. Our analysis of markets ensures that we do this effectively, helping us to decide where to focus our attention."
"The findings in the report will contribute to our upcoming Business Plan and the decisions we make affecting consumers, market integrity and competition."
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