Consumer renewal information requirements  

The FCA has repeatedly commented that many firms are failing to provide correct Consumer renewal information, following rule changes which should have been implemented in April. 

Given that they seem to be losing patience with the industry, you should review your Consumer renewal information now to ensure compliance.

From 1 April 2017, clients should have been provided with:

Confirmation of last year’s premium (updated to reflect any changes made during the year).

The following statement “have you checked that your insurance cover still meets your needs? Have you considered shopping around to find the best deal for the cover you want?”

For any clients that have been with you for more than three years, the fourth renewal invitation to the client must include the statement “You have been with us for a number of years. You may be able to get insurance cover you want at a better price if you shop around. 

To reiterate, the requirement only covers consumer policies (private car, home insurance, travel etc.). Additionally, there is nothing to stop you confirming that you have checked that the premium is competitive but the FCA require you to provide the reminders to clients.

Clearly, you will need to liaise with the software provider in order to ensure that you can include the previous year’s premium in the renewal letter that you sent to the client.  

Additionally, you will need to have a mechanism to enable you to identify how long clients have been with you (given the different statement required at the fourth renewal).

 Conclusion 

We do not believe that any broker will find this particularly palatable and it is designed specifically to encourage clients to shop around (which is one of the FCA objectives). However, there seems to be little evidence that the additional statements are adversely impacting retention rates for most brokers.