The Financial Conduct Authority (FCA) has published proposals to require general insurers, including private medical insurance providers, to publish details of last year's premium on renewal notices to improve consumer outcomes.
The proposals aim to address concerns that some consumers pay higher prices if they stay with the same insurer, particularly if they remain with that insurer for a long time.
The regulator said that it has found evidence of low levels of consumer engagement, switching, and a lack of competition when some types of insurance policies are renewed.
A spokeperson from the FCA confirmed to COVER that the proposals do not apply to protection insurance but apply to all policies classed as general insurance.
In 2014, the FCA launched a trial with over 300,000 consumers across the UK to test reactions to different types of information provided at renewal and whether this prompted people to switch.
The inclusion of last year's premium on renewal notices had the greatest impact, prompting between 11% and 18% of people to either switch provider or negotiate a lower premium when prices sharply increased.
The FCA tested simplified renewal notices that reinforced key messages such as the right to cancel and switch.
It also sent shopping around leaflets with renewal letters and reminders sent through email, letter and text message.
The FCA is also proposing for firms to prompt consumers who have renewed the same product four times or more to encourage them to engage.
There will also be guidance on how firms can improve their processes around renewals to deliver greater better outcomes for consumers and maintain records of past premiums.
The FCA is seeking feedback on its proposals by 4 March 2016.
Christopher Woolard, director of strategy and competition at the FCA, said: "We hope the proposals encourage more people to shop around for the best product for them. It is important that insurers give their customers the information they need to do this and ensure they're treating their customers fairly."
