The Consumer Rights Act 2015, which applies to consumer insurance contracts, received Royal Assent on March 26. The Act will reform and consolidate consumer law in the United Kingdom (UK). For insurers offering consumer products the main impact of the Act is likely to be seen in the new laws for digital content and ancillary contracts, unfair contract terms and the changes to the mechanisms for consumer redress. For most firms the new consumer law will not have a significant impact on their business. Many of the measures reflect much of the Financial Conduct Authority (FCA) best-practice in terms of policy wording and Treating Customers Fairly. But this is a major piece of legislative reform that does introduce some changes that insurers should be aware of. In particular firms should be aware of the introduction of rules to ensure that digital content (for example some ‘apps’ offered to policyholders) is fit for purpose, changes to consumer cancellation rights and the requirement to make all potentially onerous core terms ‘prominent’.
For further detail and commentary on how the Act will impact your business view Consumer Rights Act 2015 receives Royal Assent – what do insurers need to know?, March 2015