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| Insurance: Millions of loyal customers 'overpay on car and home cover' | Insurance: Millions of loyal customers 'overpay on car and home cover' |
| (32 minutes later) | |
| Failings in the market for home and car insurance mean consumers are overpaying by about £1.2bn year, the City regulator has concluded. | Failings in the market for home and car insurance mean consumers are overpaying by about £1.2bn year, the City regulator has concluded. |
| In an interim report, the Financial Conduct Authority (FCA) estimates some six million consumers pay on average £200 too much on premiums. | In an interim report, the Financial Conduct Authority (FCA) estimates some six million consumers pay on average £200 too much on premiums. |
| Competition was not working and loyal customers were penalised, it said. | Competition was not working and loyal customers were penalised, it said. |
| FCA action could include bans on automatic price rises and making firms move consumers to cheaper deals. | FCA action could include bans on automatic price rises and making firms move consumers to cheaper deals. |
| "This market is not working well for all consumers," said Christopher Woolard, executive director of strategy and competition at the FCA. | "This market is not working well for all consumers," said Christopher Woolard, executive director of strategy and competition at the FCA. |
| "While a large number of people shop around, many loyal customers are not getting a good deal. We believe this affects around six million consumers. | "While a large number of people shop around, many loyal customers are not getting a good deal. We believe this affects around six million consumers. |
| "We have set out a package of potential remedies to ensure these markets are truly competitive and address the problems we have uncovered. We expect the industry to work with us as we do so." | "We have set out a package of potential remedies to ensure these markets are truly competitive and address the problems we have uncovered. We expect the industry to work with us as we do so." |
| The regulator found that some insurers targeted price increases at those less likely to switch. It also found that many lower paid or vulnerable consumers faced higher premiums. | The regulator found that some insurers targeted price increases at those less likely to switch. It also found that many lower paid or vulnerable consumers faced higher premiums. |
| Possible FCA remedies include: | Possible FCA remedies include: |
| The FCA also said that it was considering whether firms should publish information about price differentials between their customers. | The FCA also said that it was considering whether firms should publish information about price differentials between their customers. |
| The authority intends to publish its final report on possible remedies in early 2020 after further consultation with the industry and consumer groups. | The authority intends to publish its final report on possible remedies in early 2020 after further consultation with the industry and consumer groups. |
| 'I feel she's been cheated' | 'I feel she's been cheated' |
| When Paul, from Staffordshire, looked at his mother-in-law's buildings and contents insurance he could not believe she was paying £800 a year. | When Paul, from Staffordshire, looked at his mother-in-law's buildings and contents insurance he could not believe she was paying £800 a year. |
| He went to Citizens Advice for help, telling them: "She lives in a small mid-terraced house - it is nothing fancy. | He went to Citizens Advice for help, telling them: "She lives in a small mid-terraced house - it is nothing fancy. |
| "I went on an online insurance comparison site and did a few different searches with different types of cover. It always came out at around the £300 mark or lower," he said. | "I went on an online insurance comparison site and did a few different searches with different types of cover. It always came out at around the £300 mark or lower," he said. |
| "My heart sank when I realised that she had been with the same company for over five years. | "My heart sank when I realised that she had been with the same company for over five years. |
| "She is an 89-year-old lady and doesn't have the capacity to sort all of that out herself. I feel like she's been cheated. And I think it seems like common practice, to rip off the people who are most vulnerable." | "She is an 89-year-old lady and doesn't have the capacity to sort all of that out herself. I feel like she's been cheated. And I think it seems like common practice, to rip off the people who are most vulnerable." |
| He has made a complaint to the financial ombudsman. | He has made a complaint to the financial ombudsman. |
| 'Bold ideas' | 'Bold ideas' |
| Huw Evans, director general of the Association of British Insurers, the industry's trade body, said his members accepted that the home and car insurance markets could work better for consumers who do not shop around at renewal. | Huw Evans, director general of the Association of British Insurers, the industry's trade body, said his members accepted that the home and car insurance markets could work better for consumers who do not shop around at renewal. |
| But he added: "This is not an issue unique to insurance. It is important that any unintended consequences are carefully considered to ensure that a fair and balanced approach is achieved for all customers." | |
| Gillian Guy, chief executive of Citizens Advice, said "it's great to see the FCA acknowledging that the insurance market isn't working". | Gillian Guy, chief executive of Citizens Advice, said "it's great to see the FCA acknowledging that the insurance market isn't working". |
| But she cautioned that the FCA's report set out proposals only. "The FCA must now follow through on these bold ideas to stop loyal insurance customers being penalised," she said. | But she cautioned that the FCA's report set out proposals only. "The FCA must now follow through on these bold ideas to stop loyal insurance customers being penalised," she said. |
| Citizens Advice said it should not to left to the consumer to find the best deals. Rather, the market should be set up to ensure everyone is treated fairly. However, its advice to people searching for the lowest prices is: | Citizens Advice said it should not to left to the consumer to find the best deals. Rather, the market should be set up to ensure everyone is treated fairly. However, its advice to people searching for the lowest prices is: |
| Paying a poverty premium | Paying a poverty premium |
| By Kevin Peachey, personal finance reporter | By Kevin Peachey, personal finance reporter |
| You have never had a problem with your insurer or bank so you have stayed with them for years. | You have never had a problem with your insurer or bank so you have stayed with them for years. |
| What the FCA's, and other reviews, have shown is that this is an expensive option - for home and motor cover, overdrafts and more. | What the FCA's, and other reviews, have shown is that this is an expensive option - for home and motor cover, overdrafts and more. |
| Loyalty does not pay. | Loyalty does not pay. |
| Those unable or uncomfortable with searching for a better deal online, or haggling, pay more. There is also a nod in this FCA report to the poverty premium - you get a worse deal if your finances are less "resilient" or you struggle with handling money. | Those unable or uncomfortable with searching for a better deal online, or haggling, pay more. There is also a nod in this FCA report to the poverty premium - you get a worse deal if your finances are less "resilient" or you struggle with handling money. |
| Many of the same people will be among the eight million who an independent report estimated would be left behind if the UK became a cashless society. | Many of the same people will be among the eight million who an independent report estimated would be left behind if the UK became a cashless society. |
| Undoubtedly, they will feel like the financial victims of the advances in technology which have have changed the way we live our lives. | Undoubtedly, they will feel like the financial victims of the advances in technology which have have changed the way we live our lives. |
| Have you overpaid for home or car insurance? Share your experiences by emailing haveyoursay@bbc.co.uk. | Have you overpaid for home or car insurance? Share your experiences by emailing haveyoursay@bbc.co.uk. |
| Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways: | Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways: |
| Or use the form below: | Or use the form below: |