New Rules on General Insurance Add-ons - ban on opt-out selling of add-ons and measures to improve the information provided to customers to make informed decisions.
The Financial Conduct Authority's General Insurance Add-ons Market Study of July 2014 found that competition in add-on markets is not effective and is not working in the best interests of customers. It proposed four remedies:
- a deferred opt-in for Guaranteed Asset Protection Insurance (GAP) which concerns motor vehicles that came into on force on 1 September 2015;
- the introduction of "value measures" such as publication of a claims ratio - a discussion paper was published in June 2015 and a consultation paper is due out soon;
- a ban on opt-out selling of add-ons sold in conjunction with regulated financial services products; and
- measures to improve the information provided to customers to make informed decisions when buying add-ons, the subject of Policy Statement (PS15/22) and final rules in September 2015.
The attached briefing discusses in question and answer format the third and fourth remedies, that is the ban on opt-out selling and measures to improve the information provided to customers.