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Ban on ‘price-walking’ working – Central Bank
Pic: RollingNews.ie

20 Dec 2023 / regulation Print

Ban on ‘price-walking’ working – Central Bank

The Central Bank has said that it is satisfied that measures introduced to prevent insurance customers from being penalised for loyalty are working effectively.

The ban on so-called ‘price-walking’ was introduced in 2022 after a review of the car and home-insurance markets in 2021.

The measure was aimed at preventing insurance companies from imposing a ‘loyalty penalty’ on customers who stayed with the same insurance provider for a number of years.

It did not, however, stop insurers from offering discounts for new business.

No further measures needed

The Central Bank review of the measure found that it had addressed the ‘loyalty penalty’ for home and motor insurance, and had not caused any unintended consequences.

It added that it was satisfied that no further measures were needed at the moment.

The review found that insurance providers now had “much more robust” oversight processes, analysis and reporting on their pricing practices and models.

“Consumers who are on their second or subsequent renewal are no longer paying premiums that are higher than they would have to pay if they were a year-one renewal consumer,” the regulator said.

Automatic renewal

It added that providers were still offering new-business discounts, and that consumers still had the ability to shop around for discounts.

The review also said that insurance providers had improved their automatic-renewal processes to help consumers make more informed decisions, though the regulator added that it would consult on further measures in this area in a forthcoming review of the Consumer Protection Code.

The bank was required to submit a review of the measures to the Minister for Finance under the Insurance (Miscellaneous Provisions) Act 2022.

Gazette Desk
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