The Financial Conduct Authority (FCA) has the power and responsibility to step in and protect consumers by taking tough enforcement action against insurers that are failing to meet their Consumer Duty obligations, or complying with FCA insurance rules or wider consumer law.
Our research suggests that too many insurers are still falling short and letting customers down when they need support the most.
Here, we explain why we're calling on the regulator to use its full powers to crack down on insurers that continue to fall short.
End the Insurance Rip-off
The Consumer Duty, which came into force in July 2023, requires financial firms to provide clear communications, offer fair value and deliver the support customers need when it matters most. But our investigations suggest that too many insurers are still falling short.
While the FCA has raised concerns and launched some reviews, we believe the regulator must now go further and act more decisively to make insurance work better for consumers.
Find out more:.Premium finance fairness
Feeling short-changed at the point of claiming isn't the only area in which we've uncovered issues.
Earlier this month, our latest findings were cited in a letter sent to the FCA's chief executive Nikhil Rathi, sent by MP Danny Beales and signed by 77 other MPs, calling for action from the regulator.
The FCA's 'softly-softly' approach isn't enough
The FCA has carried out reviews into how financial firms support vulnerable customers, has flagged concerns about standards of claims service and is currently examining premium finance (the credit arrangements enabling many customers to pay for insurance monthly) and also claims service – with the verdicts from both reviews expected later this year.
However, we think stronger enforcement action is likely to be required to lead to the changes consumers need.
Rocio Concha (pictured above), Which? director of policy and advocacy, said:
'From painful claims processes, to unreasonable policy exclusions and unjustifiably high interest rates for people paying monthly - it's obvious the insurance market isn't working and thousands of consumers are demanding action from the regulator.
'The Financial Conduct Authority must send a clear message to firms continuing to fail to meet expectations: enough is enough. Only through tough enforcement action, will we finally end the insurance rip-off.'
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source https://www.which.co.uk/news/article/which-urges-regulator-to-take-decisive-action-on-rip-off-insurance-agzwv8B7UhmD