Levelling up the playing field....

Wapping

Moderator
Moderator
Joined
Oct 21, 2005
Messages
78,793
Reaction score
3,556
Location
Wapping, London
The FCA (faceless suits who nobody voted for) are moving towards stopping the practice whereby insurers (or their agents in most cases) buy in business with attractive (ie heavily discounted) first year offers. This is not dissimilar to the action the FCA’s predecessor took with the banks.

We’ll see what this means for bods’ renewals and if the FCA’s initiative is successful.
 
The FCA (faceless suits who nobody voted for) are moving towards stopping the practice whereby insurers (or their agents in most cases) buy in business with attractive (ie heavily discounted) first year offers. This is not dissimilar to the action the FCA’s predecessor took with the banks.

We’ll see what this means for bods’ renewals and if the FCA’s initiative is successful.
Isn't that the sinecure that the insurance failures gravitate too

Sent from my SM-N950F using Tapatalk
 
Is this the same FCA that had the banks raise pre-arranged overdraft rates from about 10% up to 40% “in the interest of customers”? :)
 
So basically premiums will rise dramatically as the "first year" discounts will disappear...

Not necessarily.
Initial year was often sold at a loss to get the punters in, knowing that a lot of folk won't change despite heavy increases in subsequent years to recover the initial loss.
By stopping the first yr discount, the insurance companies will be competing on, as Wapping put it, a level playing field.
If they're not selling the first year at a loss, they won't need to load subsequent yrs to get their money back.
We will be able to compare like-for-like and perhaps get some real competition on the basic premium and not on special deals.
 
So basically premiums will rise dramatically as the "first year" discounts will disappear...

Not necessarily. Anyway, you'll still be able to shop around at each renewal. What might start to make an appearance would be multi-year policies, with a pre-agreed discount in years two and three but with penalties if you cancel. Those might well be attractive to punters who do not change their bike and home address more often than they change their undercrackers. To be frank the whole selling of private Motor insurance needs a big kick up the arse, along with some of its most moaning buyers.
 


Back
Top Bottom