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Sinn Féin says it is to introduce legislation that would prohibit the practice of dual or differential pricing in the insurance market.
This follows a decision by the UK regulator that it will move to ban the practice that implies that insurers differentiate between clients for reasons other than the expected cost of claims and expenses.
According to plans announced by the Financial Conduct Authority (FCA), companies would be free to set prices for new businesses.
But they would be prevented from gradually increasing the renewal price for consumers over time, which is known as “price hike,” except based on changes in a customer’s risk.
The FCA previously identified that six million policyholders were paying high or very high margins in 2018.
Sinn Féin has been running a campaign to ban the practice, arguing that it targets vulnerable, elderly, and low-income groups.
The Central Bank is conducting a review of the issue and recently said it is concerned about weaknesses it has identified in the pricing practices used by some insurance companies.
The bank found that some companies may not be adequately considering the effect of their pricing practices on their consumers, which could lead to poor results for customers.
An analysis carried out in recent months by the bank established that, although some companies claim that they do not use differential prices, most companies do use them through various techniques.
“Irish clients cannot afford to wait another year for the central bank to complete its review,” said Pearse Doherty, Sinn Féin finance spokesman.
“What we need is immediate action: dual pricing should be banned. It’s as simple as that.”
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