Britain’s financial watchdog has told insurers to help customers struggling to pay the premiums on their policies, which could leave them unprotected.
The Financial Conduct Authority said it was writing to the bosses of insurance firms to to make sure their customers are protected from unnecessary products or add-ons and unfair penalties. Where poor practice is found, the FCA vowed to quickly intervene to protect customers from harm.
The watchdog said firms can help customers in financial difficulty by:
- Reassessing customers’ needs
- Considering whether there are other products that better meet the customer’s needs
- Providing clear information to consumers about the additional cost of premium finance
- Working with customers to avoid the need to cancel necessary cover
- Waiving fees associated with adjusting a customer’s policy in line with the reassessments
- Considering whether cancellation fees should be removed for customers in financial difficulty
Sheldon Mills, executive director of consumers and competition at the FCA, said: “Customers who are struggling with their finances should contact their providers as soon as possible. We encourage customers to continue to shop around to find the best deal.
“Firms should not unfairly penalise them for any payment difficulties but instead work with them to find solutions.”