Financial watchdog to probe home and car insurance pricing
The financial watchdog has launched a study into how insurance firms charge their customers for home and motor insurance.
The Financial Conduct Authority (FCA) says it is concerned that insurers' pricing practices have the potential to harm consumers, particularly those who are vulnerable.
It says this study will give it a better understanding of the scale of harm to consumers, who it affects and, if necessary, what actions are required to improve the market.
What will the study look at?
The FCA says its study will look into the following topics:
- The outcomes for consumers of firms' pricing practices
- How fair these outcomes are
- The impact of pricing practices on competition
- Remedies to address any harm that the FCA finds
It aims to publish an interim report in summer 2019 setting out preliminary conclusions and if necessary, a discussion of potential remedies. It will then publish a final report by the end of 2019.
The FCA says it's also working closely with the Competition and Markets Authority as it investigates the Citizens Advice super-complaint on excessive prices for loyal customers who do not switch for better deals.
What does the FCA say?
FCA chief executive Andrew Bailey said: "Our initial work has identified a number of areas of potential consumer harm. We want to make sure that general insurance markets deliver competitive and fair prices for all consumers.
"This market study will help us examine the outcomes from general insurance pricing practices and inform how, if necessary, we should intervene to improve the market.
"If change is needed to make the market work well for consumers, we will consider all possible remedies to achieve this."