We wrote last year about the launch of a pilot scheme to help consumers compare insurance firms. The results have now been published.
The Financial Conduct Authority (FCA) launched the scheme because it’s becoming increasingly difficult to find the right insurance product at the right price, to understand whether special offers for add-on products are worthwhile, and to understand the finer details of the policy you’re taking out. This is why so many people turn to us when they need to make a claim: they suddenly discover that they haven’t got the cover they thought they had, or that the insurer they chose is very difficult to deal with.
The scheme uses a scorecard system to rate claims frequencies and acceptance rates as well as average claim pay-outs. The results make for very interesting reading, including:
- There is a huge difference between insurers on how likely you are to receive a pay-out for your home insurance claim. With some insurers, the chance of making a successful claim is over 90 per cent, with others it’s a low as 20 per cent. As loss assessors, we know the insurance companies which are more likely to respond well to claims and those which are not, and we tailor our approach accordingly to ensure our clients receive what they’re entitled to.
- Many of the add-on products sold alongside home or motor insurance cover, such as personal accident or key cover, offer very poor value for money and rarely lead to pay-outs. Indeed, one add-on policy offered by a leading insurer resulted in no claims at all over the year.
The results also show average pay outs, but this doesn’t tell us the difference between the original claim value and the eventual settlement figure. This is another area where using a loss assessor can make a vital difference: many of our clients will confirm that using us to handle their claim resulted in a larger – and fairer – settlement than if they’d tried to battle the insurer by themselves.
This new scheme is a huge step forward in providing transparency. It should help consumers choose the right insurance provider and policy, and also understand how unnecessary some add-on products can be. The full results can be seen on the FCA website.