Christopher Woolard, director of strategy and competition, said: “We hope the proposals encourage more people to shop around. It is important that insurers give customers the information they need to do this, and ensure they are treating customers fairly.”
The proposals – set out in a consultation paper entitled Increasing Transparency and Engagement at Renewal – follow concerns about the treatment of consumers by firms at renewal, and the lack of competition resulting from this.
The FCA wants to develop guidance on how firms can improve their processes around renewals to deliver greater clarity and better outcomes, proposing that firms maintain records of past premiums.
David Heffron, head of financial regulation at law firm Pinsent Masons, said: “The FCA’s recommendation is not the “silver bullet” to resolve the challenges insurers have in developing their pricing strategy.”
The FCA published its consultancy paper on 3 December, setting out its proposals to introduce rules and guidance on steps firms should take when renewing insurance policies, in conjunction with their obligations to treat customers fairly.
Feedback on its proposals is open until 4 March 2016.