The FCA’s latest market study (MS18/1.2), on general insurance pricing practices, continues its focus on general insurance markets. Building on an earlier thematic review on home insurance, the FCA has looked in particular at how firms adapt the margins they aim to earn according to the likely behaviour of individual customers.
- The FCA has found that pricing practices in the home and motor insurance markets are “not working well for consumers”. It will consult on potential remedies in Q1 2020 once its final report is published.
- Possible solutions include prohibiting certain pricing strategies and measures designed to make switching easier for consumers.
- Firms’ oversight of pricing practices requires “significant improvement”.
- All firms in the general insurance distribution chain (including distributors and price comparison websites) are impacted by these findings.
- The deadline for responding to the FCA’s questions is 15 November 2019.
Our “at a glance” guide (which can be found here) provides a summary of the FCA’s interim report.