Insurers must be forced to justify huge annual increases | Daily Mail Online

Pensioners are the worst-hit because they are less likely to look for deals online.

The calls for insurers to be forced to justify to customers why they have hiked their premium come after a Money Mail investigation found long-standing customers are being over-charged by up to £1,000, while insurers offer new customers loss-making introductory deals. In the worst cases, insurers are charging people six times the cheapest price on the market.

George Kerevan, a Scottish National Party candidate who was a member of the Treasury select committee, called for an immediate investigation into pricing techniques. He believes the Competitions and Markets Authority (CMA) should look for evidence of rip-off deals over fears insurers could be colluding on price rises.

The Financial Conduct Authority watchdog should then draw up a new set of guidelines forcing insurers to explain why they are putting customers’ prices up, he said. Any which failed to justify their behaviour could be heavily fined as a result.

Mr Kerevan, a former economist, said: ‘Companies which offer a pricing system that harms customers should have financial penalties imposed upon them.’

Since April, insurers have been forced by the FCA to declare how much they are raising their price by on renewal letters, but campaigners say this is not enough.

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Insurers must be forced to justify huge annual increases | Daily Mail Online.