Martin Schultheiss is chief commercial officer at Uinsure
The proposals set out by the FCA’s final consultation of GI pricing practices mean that existing customers will never pay more for their insurance than new customers.
It’s an absolute move to fairness, transparency and better outcomes for consumers but what will these new rules mean for you as advisers?
The rules expected to come into force next year will firstly act as a leveller of new business premiums.
The significance of this move creates a first-time opportunity for advisers to provide home insurance advice with far less price sensitivity than what has emerged since the rise of price comparison websites and aggregators.
Now that heavily discounted first-year pricing will be removed from the conversation, advisers can make headway in a fairer market and offer a real differential that delivers on the outcomes that the FCA are looking for; ensuring that customers are informed to make decisions and understand crucial product features such as policy coverage as part and parcel of an overall advised service.
With the GI pricing rules in place, it’s also likely that existing customers may become less inclined to switch providers, with the knowledge that their renewal premium reflects the price they would receive as a new customer.
In the past shopping around has always been considered a simple way to save money on insurance premiums, with those customers who religiously scour the market at renewal for better deals coined as “savvy” shoppers.
The FCA’s proposals removes the unfair impact on customers who aren’t as savvy, whether time-poor, too trusting or often vulnerable and it will likely mean that aggregators and PCWs may face more pressure in their business model, as they see a reduction in traffic through their platforms.
More so than any brands on the planet – advisory firms are a trusted voice to loyal and longstanding customers and certainly best positioned to make sure that home insurance needs are covered and up to date.
Put simply, you have the first indication that home insurance may be needed – and let’s be frank – parallel markets would pay undisclosed figures for that insight.
Here at Uinsure our intermediary proposition is strongly placed to support your customers, having never discounted first year premiums and offering a digital-led service that automatically keeps an eye on renewal dates to deliver the most competitive premiums.
Just make sure your chosen GI provider can say the same.
On top of all of the other advances in intermediary GI technology that makes home insurance advice simpler and time-efficient, we are certainly backing the adviser through and through to recapture the market share it deserves.