FCA launches study into GI firms

The regulator says it wants to address conduct by firms, investigate GI pricing practices and discuss fairness of pricing across the wider financial services market.

The FCA says it is concerned that GI pricing practices "have the potential to cause harm to consumers, particularly those who are vulnerable".

The FCA’s supervisory work on home insurance found other issues which could cause harm to customers, including firms failing to have appropriate or clear pricing strategies, governance and controls.

It has also identified potential non-compliance by some firms with our rules on transparency at renewal.

Additionally, the regulator is working with the CMA as it investigates the Citizens Advice super-complaint on excessive prices for disengaged customers.

The FCA says its study will give a better understanding of what actions are required to ensure that GI markets deliver competitive and fair prices.

It aims to publish an interim market study report in summer 2019 setting out preliminary conclusions including a discussion of potential remedies.

Andrew Bailey, chief executive of the FCA, commented: “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.”