September is the month when the insurance industry returns from holiday and gets down to 2017 budget planning. While last year’s performance is a starting point, there are three pieces of recent legislation that will challenge your assumptions about buying patterns and the extent to which last year’s performance is an accurate guide.
The CMA’s protected NCB ruling could mean lower premiums as fewer consumers take it out.
Consumer Intelligence’s IBT tool shows that 25% of motorists asked to protect their no claims bonus when it was offered in the main question set at the initial quote stage. But since the 1st of August when requirements to give more information on the product came into force, many providers offer it later in the customer journey and amongst add-ons. This is likely to reduce uptake, although we don’t yet know by how much.
Getting the customer journey and positioning of add-ons wrong could decrease your GWP
From the end of September, the FCA’s guidance to include popular add-ons in the main quote journey kicks in. People tend to buy insurance passively and their decisions on what to include and what information to disclose is often driven by the quote journey. They’re likely to go with the flow so if any changes to question order, and what’s included or excluded, could have a big impact on what they buy.
Prominently displaying last year's price on renewal communications could lead to more shopping around.
This will affect everyone differently, with insurance providers who offer the largest introductory discounts standing to lose the most. Insurers with longer-serving customers may also lose out, even if they don’t pass on big increases, as at the fourth renewal they must be told: “‘You have been with us for a number of years. You may be able to get the insurance cover you want at a better price if you shop around.” The FCA itself estimates that consumers will save between £64m and £103.4m as a result of the disclosures.
Model how these changes will impact your business
Consumer Intelligence is working with insurers to model how these changes will impact their individual businesses.
Contact us if you would like to know what they mean for you and your business.
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