UK's financial regulator will protect consumers from 'loyalty penalty'
May 28, 2021, 12:34 pm

New residential homes are seen at a housing estate in Aylesbury, Britain, February 7, 2017. REUTERS/Eddie Keogh/File Photo

Huw Jones, Tom Wilson

Britain's financial regulator said on Friday it will move to protect consumers from so-called loyalty penalties in motor and home insurance, potentially saving an estimated 4.2 billion pounds ($5.95 billion) over 10 years.

The Financial Conduct Authority (FCA) said in a statement it would set new rules to ensure consumers renewing quotes for home and motor insurance are not charged more than new customers.

Many insurers increase prices for existing customers each year when they renew policies. The practice, known as "price walking", means consumers must look for new deals and switch providers every year to avoid higher prices.

"It is likely that firms will no longer offer unsustainably low-priced deals to some customers," the FCA said.

The FCA will also bring in new rules so consumers can more easily cancel automatic policy renewals and require insurers to look more closely at how they offer fair value for consumers. It will also require home and motor insurance firms to report more data to the regulator.

The Association of British Insurers (ABI) welcomed the FCA announcement and said it supported the reforms and would work closely with the watchdog to implement them.

"It is vital that the new rules are applied across the whole insurance market, including price comparison websites and insurance brokers, with a uniform level of supervision and monitoring by the FCA, to ensure good customer outcomes," said Charlotte Clark, director of regulation at the ABI.

New rules on systems and controls, product governance and premium finance will take effect from the end of September, with the rules on pricing, auto-renewal and data reporting starting from 2022.

Six million car and home insurance policyholders paid high prices in 2018 in the 18 billion pound market, the watchdog said in 2019. If they had paid the average price for a policy, they would collectively have saved 1.2 billion pounds.

Reuters, May 28, 2021/12:39 PM EEST

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BENEFIT, the Kingdom’s innovator and leading company in Fintech and electronic financial transactions service, has sponsored the BuildHer CityHack 2025 Hackathon, a two-day event spearheaded by the College of Engineering and Technology at the Royal University for Women (RUW).
Aimed at secondary school students, the event brought together a distinguished group of academic professionals and technology experts to mentor and inspire young participants.
More than 100 high school students from across the Kingdom of Bahrain took part in the hackathon, which featured an intensive programme of training workshops and hands-on sessions. These activities were tailored to enhance participants’ critical thinking, collaborative problem-solving, and team-building capabilities, while also encouraging the development of practical and sustainable solutions to contemporary challenges using modern technological tools.
BENEFIT’s Chief Executive Mr. Abdulwahed AlJanahi, commented: “Our support for this educational hackathon reflects our long-term strategic vision to nurture the talents of emerging national youth and empower the next generation of accomplished female leaders in technology. By fostering creativity and innovation, we aim to contribute meaningfully to Bahrain’s comprehensive development goals and align with the aspirations outlined in the Kingdom’s Vision 2030—an ambition in which BENEFIT plays a central role.”
Professor Riyadh Yousif Hamzah, President of the Royal University for Women, commented: “This initiative reflects our commitment to advancing women in STEM fields. We're cultivating a generation of creative, solution-driven female leaders who will drive national development. Our partnership with BENEFIT exemplifies the powerful synergy between academia and private sector in supporting educational innovation.”
Hanan Abdulla Hasan, Senior Manager, PR & Communication at BENEFIT, said: “We are honoured to collaborate with RUW in supporting this remarkable technology-focused event. It highlights our commitment to social responsibility, and our ongoing efforts to enhance the digital and innovation capabilities of young Bahraini women and foster their ability to harness technological tools in the service of a smarter, more sustainable future.”
For his part, Dr. Humam ElAgha, Acting Dean of the College of Engineering and Technology at the University, said: “BuildHer CityHack 2025 embodies our hands-on approach to education. By tackling real-world problems through creative thinking and sustainable solutions, we're preparing women to thrive in the knowledge economy – a cornerstone of the University's vision.”