Chapter 4 - Renewals and Cancellation

Question 1

Renewal - ICOBS Rule 6.1.5R

Answer 1

A firm must take reasonable steps to ensure a customer is given appropriate information about a policy in good time and in a comprehensible form so that the customer can make an informed decision about the arrangements proposed

Question 2

Renewal - April 2017 FCA Regulatory Rules

Answer 2

These rules are for transparency which affect personal insurances. These require insurers and intermediaries selling retail general insurance products to:
* Disclose last years premium
* Include text to encourage consumers to shop around
* Identify consumers who have renewed with them for 4 consecutive times and give them an additional message to shop around

Question 3

Renewal - CIDRA 2012

Answer 3

Insurer needs to draw specific attention the consumer of the questions and answers provided in the proposal form at renewal.

Question 4

Renewal - Consumer Rights Act 2015

Answer 4

This legislation specifically requires the provision of transparent and prominent notices to customers, including renewal notices.

Question 5

Cancellation Notice

Answer 5

Insurer has to send at least seven days of written notice to cancel. It is more common to see conditions requiring 30 days.

Question 6

Cancellation - ICOBS 7.1.1R

Answer 6

Gives consumers of a general insurance contract a 14 day period from inception to cancel their policy.

Question 7

Cancellation - Consumer Rights Act 2015

Answer 7

Introduces new protections for consumers around cancellation of contracts:
* Insurers can charge proportionate administration fees
* If the primary policy is cancelled, the ancillary or add-on policy must also be cancelled
* Refund usually calculated as pro rata
* No refund is usually given where there has been a claim during the policy period