ICOBS 6.5 Renewals

1This section applies when a firm proposes to a consumer the renewal of a general insurance contract, which is not a group policy, and which has a duration of 10 months or more.

In this section, ‘renewal’ means carrying forward a policy, at the point of expiry and as a successive or separate operation of the same nature and duration as the policy, with the same insurance intermediary or the same insurer.

The firm must provide to the consumer the following information in good time before the renewal:

1. (a)

   the premium to be paid by the consumer on renewal;

2. (b)

   in a way that is consistent with the presentation of (a) so that they can be easily compared:

   1. (i)

      except where (ii) applies, the premium for the policy which the firm proposes to renew, as set out at the inception of that policy;

   2. (ii)

      where one or more mid-term changes were made to the policy which the firm proposes to renew, an amount calculated by annualising (or otherwise adjusting as appropriate to the duration of the proposed policy) the premium in effect following the most recent mid-term change, excluding all fees or charges associated with those mid-term changes;

3. (c)

   a statement alongside (a) and (b) indicating that the consumer:

   1. (i)

      should check that the level of cover offered by the renewal is appropriate for their needs; and

   2. (ii)

      is able, if they so wish, to compare the prices and levels of cover offered by alternative providers

Where the proposed renewal will be the fourth or subsequent renewal the consumer has entered into in respect of the policy, the firm must include the following statement, to appear alongside the matters required by (3)(a), (b) and (c)(i) (but omitting (c)(ii)): “You have been with us a number of years. You may be able to get the insurance cover you want at a better price if you shop around.”

The firm must communicate the information in (3) and (4):

1. (a)

   clearly and accurately;

2. (b)

   in writing or another durable medium; and

3. (c)

   in a way that is accessible and which draws the consumer’s attention to it as key information.