Your rights when your insurance renews

For years, insurers ran a simple play: quote low to win a customer, then raise the price a little every year on the assumption they wouldn't check. The industry term was price walking. The FCA's own market study found it worked — loyal customers routinely paid more than new ones for identical cover.

The FCA banned it in Policy Statement PS21/5, implemented through the ICOBS 6B rules, in force since 1 January 2022. The rule is narrow and specific:

An insurer must not quote an existing customer a renewal price higher than the equivalent new-business price it would offer a new customer for the same cover through the same channel. Verified

What it does not mean. This is the part most coverage gets wrong, so it's worth being exact.

• It does not cap price rises. If the underlying cost of cover rises for everyone, your renewal rises too — legally.
• It does not mean your renewal is the cheapest available. It only ties your price to that insurer's own new-customer price.
• It applies to the same channel. A price found through a comparison site may legitimately differ from the direct price.
• It does not stop insurers offering introductory discounts to new customers — those are permitted, provided the renewal price isn't inflated to fund them.

The FCA re-examined the rules in an evaluation published in July 2025 and left them in place. In September 2023 it required Direct Line Group to pay redress of around £30m after an error in how it calculated equivalent new-business prices — the first enforcement of its kind under these rules, and a useful reminder that the calculation is auditable. Verified

Under the FCA's ICOBS renewal rules, a renewal notice must be issued in good time before cover ends, and must show:

• The new premium, presented so you can act on it.
• The premium you paid last year, alongside it, so a rise is visible rather than buried.
• Clear notice of whether the policy will renew automatically.
• Encouragement to check the cover still suits you and to shop around.

Where a policy has renewed four or more consecutive times, the notice must carry a prominent prompt to consider switching. If your notice doesn't show last year's premium next to this year's, that's worth raising with the insurer directly. Verified

Automatic renewal is a convenience that quietly removes the moment where you'd otherwise compare prices. You can switch it off, and doing so is free — an insurer cannot charge you to opt in or out.

• Do it early. Opting out close to the renewal date can be awkward to process. Three to four weeks ahead is comfortable.
• Opting out is not cancelling. Your current cover runs to its end date as normal; it simply won't roll over.
• Get it in writing. Ask for email confirmation, and check your renewal notice says the policy will not renew automatically.
• Watch the continuous payment authority. If you pay by card, opting out should stop the charge — confirm that explicitly rather than assuming.

You have a statutory right to cancel within 14 days, running from the start of cover or from the day you receive your policy documents, whichever is later. It applies to a new policy and again after each automatic renewal — which is the part people miss.

If you cancel in that window the insurer may charge for the days you were covered, and may apply a small administration fee. If you cancel after it, a larger cancellation charge usually applies. Those charges vary by insurer and by product, so check your own policy schedule rather than a figure you read somewhere. Verified

Complain to the insurer first — they have eight weeks to give you a final response. If that response doesn't resolve it, or the eight weeks pass without one, you can take the complaint to the Financial Ombudsman Service. It's free for consumers, and its decisions bind the insurer.

Ombudsman referrals normally need to be made within six months of the insurer's final response, so don't sit on it. Verified