HOME and car insurance providers could be banned from hiking prices at renewal as 6million people are found to be paying over the odds for their policies.
In its interim report on the market published today, the Financial Conduct Authority (FCA) says it’s considering banning or restricting price rises for customers who renew year on year.
It may also force firms to automatically move customers onto cheaper equivalent deals at renewal.
The proposals come after the city watchdog found that 6million policyholders could save a collective £1.2billion a year if they paid the average premium for their risk.
And this includes one in three people who are potentially vulnerable.
The FCA is also considering restricting the way insurers auto-renew customers when their policy ends, and whether firms should publish information about price differences between customers.
Christopher Woolard, executive director of strategy and competition at the FCA, said: “This market is not working well for all consumers.
“While a large number of people shop around, many loyal customers are not getting a good deal. We believe this affects around 6million consumers.
“We have set out a package of potential remedies to ensure these markets are truly competitive and address the problems we have uncovered. We expect the industry to work with us as we do so.”
A final report and consultation is expected to be published in the first three months of 2020.
More to follow…
More on home insurance
It comes as recent research found that drivers are being charged up to £367 more by car dealers for insurance add-ons.
And did you know that putting a sticker of your football team’s logo on your car could make your insurance worthless?
But Martin Lewis explains how to slash £100s off car insurance renewals by skipping comparison sites.
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