General Insurance Article - Initiative working for outcomes for long standing customers


?The industry initiative to help improve outcomes for long-standing customers launched two years ago is having a positive impact according to the review of its implementation published today by the ABI (Association of British Insurers)

 The Guiding Principles and Action Points for General Insurance Pricing (GPAPs) initiative was launched by the ABI and BIBA in May 2018 to help address excessive price differences between new customer premiums and subsequent renewal premiums. At the time, the insurance sector was the first industry to take positive, collective action to address the issue of long-standing customers.

 Commitments include: prioritising better outcomes for long-standing customers at company board or senior management level; clearly communicating to customers that renewal premiums may be higher, reviewing their approach to customers on their books for five or more years, and reviewing outcomes for vulnerable customers.

 The qualitative survey encompassed 18 insurers covering around 85% of the gross written premium for both the motor and home markets) and a qualitative data collection (for intervention volume and value) covering 76% of the motor and property market

 Key findings are:

 All firms surveyed. have incorporated the GPAPs into their processes for determining renewal premiums and made the issue a Board or Executive level priority.
 Thirteen of the eighteen companies have gone further than FCA requirements on renewal pricing and are alerting new customers that the new customer premium only applies for the first year, and that renewal premiums may be higher.
 All firms surveyed have implemented a review process on renewal pricing, with 94% (by gross written premium) having a specific focus on customers who have been with them for five or more years.
 Firms covering 94% of gross written premiums have implemented processes to identify and review outcomes for vulnerable customers at renewal. The remaining firms have plans to do so.
 In total there were over 8.5 million pricing interventions across motor and home insurance over the 20 months included, worth a total value of £641 million. Individual firms reported an average saving per intervention ranging between £40 and £150 (for the majority of interventions)[1]

 James Dalton, ABI’s Director, General Insurance Policy, said: “This review shows how positively insurers have responded to implementing the Guiding Principles and Action Points. The number of insurer interventions and range of average savings are benefitting millions of customers. There is a clear commitment from the industry to continue to deliver on the Principles, as their benefits to customers should grow over time”.

 “There remains more to do, and we will continue to work with the FCA in its general insurance pricing review.”

Back to Index


Similar News to this Story

Christmas Grinch as 12m have decorations stolen or damaged
A quarter of Brits (25 per cent) who celebrate Christmas, some 12.2 million people, claim they have had their decorations damaged or stolen at least o
Ahead of FCA deadline insurers must decide on COVID refunds
Insurers have just a few days left to decide how they need to consider the guidance and where appropriate apply COVID-19 related refunds or discounts
What homeowners plan to use equity release cash for
What people plan to use equity release cash for and what they actually do with the money are not quite in sync, according to SunLife’s new Equity rele

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.