A significant reform of car insurance rules to make sure all consumers pay fair prices has been introduced by the Financial Conduct Authority , which regulates the industry.
From the start of 2022, existing customers who renew their motor or home insurance policies will pay no more than they would if they were a new customer buying in the same way. New FCA rules ban insurance companies from gradually increasing the renewal price they offer over time , although they can still increase the cost in line with changes to a customer’s risk profile.
While some people shop around for a better deal when their car insurance is due for renewal, many don’t – and until now they have ended up paying higher premiums for being loyal. When the regulatory body investigated car and home insurance policies in 2018, it discovered that six million policyholders paid high or very high margins that cost them collectively £1.2 billion.