New research has indicated that up to 13 million households in the UK are being overcharged by home insurance companies when renewing their current policy.
The findings from Citizens Advice showed that older people were particularly vulnerable, with 40% of those aged over 65 with had a five year old policy paying up to 70% more than a new customer.
Of the customers surveyed, the research indicated that just half felt confident about identifying unfair costs.
According to Citizens Advice, the practice of charging certain customers more exists on a market wide basis, with the organisation stating that up to one third of policy holders could be forking out a significant amount more than a new customer, even where the policy is exactly the same.
Despite new rules being brought in by the Financial Conduct Authority (FCA) earlier in the year, Citizens Advice believe that many home insurance providers may not have adhered to these requirements, which set out that companies should inform customers explicitly about their last premium. As a result, the FCA is being called to take further action.
Commenting on this was Chief Executive of Citizens Advice, Gillian Guy. He stated: “Home insurance companies are taking advantage of people’s loyalty, and it’s older people who are suffering the most.
“The Financial Conduct Authority must stop home insurance providers overcharging customers. Vulnerable customers are the hardest hit and must be protected from this unfair practice.”
