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FCA calls for insurance companies to be clearer


The Financial Conduct Authority (FCA) has called for insurance companies to be clearer about the costs involved in paying premiums in instalments.

The FCA believe that online sales of insurance policies by insurers, brokers and price comparison websites can lead to people becoming unaware of the differences between paying monthly and annually. This leads to different products becoming harder to compare. The FCA now believes firms should take action to make things clearer for consumers.

The FCA investigation found that insurers and intermediaries did not always provide clear and easy to understand information about the overall cost of paying for insurance. In some cases, people did not even know there was any price difference in paying annually or monthly.

Linda Woodall, acting director of supervision at the FCA, said:
"Consumers should expect clear information about the payment options available to them.
"Regardless of whether people choose to pay upfront or in instalments, it's important that they can see exactly what they are signing up for and how much it costs, so they can decide whether they are getting a fair deal."

The review by the FCA included 13 insurers and 30 insurance intermediaries, including four price comparison websites.

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