The Competition and Markets Authority (CMA) is set to up its game regarding vulnerable customers insurance and other financial services.
In its 2019/20 Plan, the CMA confirmed it would continue to investigate dual pricing practices in insurance following its work in 2018.
Furthermore, the body maintains its priority is ensuring firms threat their customers fairly.
Vulnerable customers insurance and digital capability
In addition, the marked out four targets for the upcoming two years:
- To step up its interest in those vulnerable to exploitation, or receiving a raw deal due to circumstance;
- Increase trust in markets, ensure fair treatment, and clearly explaining the benefits of a competitive market;
- Promoting better competition online, maintaining a strong digital interest, and protecting people from illegal and unfair practice online, and
- Supporting economic growth and productivity. This includes creating conditions that allow innovative businesses that treat customers well to succeed.
All of this follows a continuing investigation over practices after a “super-complaint” to the Citizens’ Advice Bureau.
The UK’s Financial Conduct Authority (FCA) has announced a probe into the insurance pricing practices of firms.
Under this move, FCA will investigate the pricing policies of home and motor insurers.
FCA CEO Andrew Bailey said: “We expect firms to look after the interests of all customers and treat them fairly, whether they are new or long-standing. It is important to get the balance right so that existing customers do not miss out on the benefits of competition and innovation, including when they purchase or renew their general insurance products.
“The general insurance market study we have announced today will help us examine the issues we have already identified in the market in more detail.”
The super complaint to the CMA alleged that long-term customers have to pay a “loyalty penalty”. According to the charity, such customers were being overcharged £4.1bn ($5.3bn) annually.
The charity claims that loyal customers across insurance have to pay significantly more than new customers.
Also, the CMA plan puts forward that the UK’s departure from the EU is still of great priority. This is in both policy development and expansion to prepare for more responsibility.
The report states: “With the UK’s exit from EU, it is particularly important that we strengthen our international profile and foster productive post-Exit relations with the European Commission and with national competition and consumer protection authorities in the EU, and globally. Part of doing so will be to intensify our participation in global competition and consumer protection forums such as the International Competition Network and the International Consumer Protection and Enforcement Network.”