Nikhil Rathi – FCA Chief Executive – has written a letter to Which?, after the organisation delivered a petition backed by 170,000 signatories, asking the FCA to toughen up its regulation of insurance companies that are “ripping off” consumers.
Which? notes that insurance companies are causing customers ‘distress and inconvenience’ in nearly 2/3 of complaints upheld by the FOS.
The FCA has acknowledged the strength of views expressed by the signatories, but notes that – as it has previously discussed with Which? – the insurance market is vital in providing consumers with peace of mind.
The FCA welcomes a constructive dialogue with Which?, and notes the following ongoing workstreams:
- The Consumer Duty, which requires insurer to ensure the price customers pay is reasonable compared to the benefits they receive;
- Protections against the so-called ‘loyalty penalty’ in home and motor insurance markets;
- Its multi-firm review of insurers’ valuation of vehicles and subsequent
- The temporary pause in the sale of Guaranteed Asset Protection products, following concern that consumers were not receiving fair value
- An incoming interim report on the FCA’s market study into whether those paying monthly ‘premium finance’ for insurance are receiving fair and competitive deals.
The FCA has also reinstated that it will not hesitate to act where it identifies harm and to ensure consumers receive fair value.