Following concerns around the renewal process for general insurance policies, the FCA undertook a thorough review of disclosure and whether or not a good process could help consumers become more engaged at the renewal stage. Consultation Paper CP15/41 sought industry views on proposed changes to rules and guidance. 

Policy Statement PS16/21, published in August 2016, summarised responses received and included final rules and guidance. A relatively short 38 pages, it is a recommended read for anyone involved in dealing with general insurance products. 

There are some new rules that will have to be implemented, most of which cover the disclosure of the previous year’s premium and encouraging consumers to shop around at the renewal stage. These rules apply to both insurers and intermediaries of general insurance products to retail customers. Note that the rules also apply to policies spread over 10 months. 

Following feedback from responses to the CP15/41, the deadline for implementing the rules has been extended from 1 January 2017 to 1 April 2017. 

Firms will be required to … 

• Disclose the previous year’s premium at each renewal, this should be either the premium the consumer started the policy with or, where relevant, an annualised premium to reflect any mid-term adjustments;
• Include text to encourage consumers to check their cover and shop around for the best deal taking into account the level of cover as well as the price;
• Identify customers who will be renewing for the fourth consecutive time and give them an additional prescribed message encouraging them to shop around.