Over the next year, we will do more to:
Improve claims handling, by reviewing firms’ customer service and delivery and how they oversee third parties that handle claims.
Improve consumer understanding of what their insurance covers, by analysing the different ways firms are selling products.
We’re already seeing industry act on our calls to improve customer understanding. We will use the findings from our reviews to continue working with firms, trade bodies and consumer groups, so people have the right information at the point of sale to make informed decisions.
We will continue to act against insurance firms where we have concerns. Since our review of home and travel insurers in July, we have:
Opened 2 enforcement cases.
Stopped 1 firm from doing business until it fixes the problems we identified.
Launched 3 independent reviews into firms’ systems and controls.
Made 3 senior managers agree to fix problems and consider whether redress is due.
We use the best tools available to us to deliver the fastest results for consumers. That isn’t always through enforcement or market studies, which inevitably take time.
Graeme Reynolds, director of competition and interim director of insurance said: “We welcome Which? shining a light on issues we identified in home and travel insurance. We’ve set out more detail on the action we’ve already taken to fix problems, and we’re expanding our existing workplan to improve the claims process and consumer understanding of their cover. We’ll be monitoring consumer outcomes and will continue to hold firms and their senior leaders to account for making improvements, to help build trust and make sure people get fair value insurance”.
We published a package of reports in July, outlining how the retail insurance market was working and setting out actions for us and others to take.
Our review of home and travel claims handling found some issues with outsourcing and storm cover definitions. We have set out more detail on the action we have already taken and we will continue to act if firms fall short of our expectations.We have shown we will hold firms to account where we see problems. For example, by securing:
£70m in savings for consumers following our work on Guaranteed Asset Protection insurance (GAP).
£350k in compensation so far for 2,500 customers after stepping in with one insurer over unclear endorsements on home insurance policies.
We have also taken significant action in the insurance sector:
Reforming pricing rules so existing customers are no longer charged more for their insurance at renewal for being an existing customer.
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