Helping the insurance sector to achieve better consumer outcomes

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Consumer-focused rules imposed on the insurance market just over one year ago, appear to be working. 

Since the Financial Conduct Authority stopped insurance providers from charging existing customers more to renew their home cover than new households signing up, renewal premiums have fallen 10%* year on year.

It’s great news for loyal customers. 

Discounting year-one premiums to incentivise customers to switch their policies has long been an industry-wide strategy to attract new business. But one year on, when the premium rises, households are compelled to switch brands again to take advantage of another introductory offer. 

So it’s little wonder, since January 2022 when the FCA halted the practice, the number of customers shopping around has fallen to record lows**. 

Fresh challenges for insurance providers

For providers this poses new challenges: how to attract new business without giving a discount and how to avoid the risk of losing loyal customers to a rival provider offering a better customer experience.  

The need to be innovative in a competitive market is essential. 

And great value insurance cover underpinned by a frictionless, easy-to-use quotation, sign-up and renewal process is a winning combination. 

Market-leading property data from Hometrack

Having access to real time property listings data, as displayed when a home is listed for sale or rent, can give providers the competitive edge they need. 

Insurance providers that have access to consistently accurate UPRN-matched UK property data, can pre-fill their new customers’ applications with their home’s core property attributes to create a quick and user-friendly quotation process. 

But to stand out from their competitors, providers need to pre-fill more than the homeowner’s address. A market-leading customer proposition should have the capability to complete the following attributes:

  • House type: terraced, semi-detached, detached
  • Number of bedrooms, bathrooms and reception rooms
  • Size of the floor area in square metres, if it’s required
  • Leasehold or freehold
  • Off street parking or garage
  • Double glazed
  • New-build status

Supporting consumer understanding of insurance processes

Pre-filling a customer’s insurance application using the most up-to-date property listings data isn’t just about time-saving, although that’s a definite plus.

By offering a frictionless and stress-free quotation journey, customers arrive at their personalised policy relaxed and ready to review the features and benefits of the cover they’ve chosen. 

They can spot any mistakes they’ve made on items to be covered or go back to make their policy more or less comprehensive. 

With less time and energy spent on completing field after field on the application form, customers can spend more time choosing the correct level of cover and understanding any conditions attached to their policy. 

These are factors key to the regulator’s next major body of work: Consumer Duty. 

Coming into force this summer, consumer understanding is one of the four outcomes insurance providers must evidence that they are delivering on along with price and value, products and services and consumer support. 

By taking away the form-filling hassle, households can focus on what’s most important – their cover and the protections it offers. 

*Association of British Insurers

**  Consumer Intelligence

Samantha Partington 11 July 2023
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