Central Bank implements new Insurance Regulations
Ban on price walking in motor and home insurance comes into effect on 1 July 2022. New customer discounts not affected. For automatic renewals, better information and reminders to be provided to encourage switching. The Central Bank of Ireland has today published the Central Bank (Supervision and Enforcement) Act 2013…
The Central Bank of Ireland (CBI) published the Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Insurance Requirements) Regulations 2022 on 15 March 2022, banning price walking in motor and home insurance from 1 July 2022 to eliminate loyalty penalties for renewing customers while preserving new customer discounts and competition. This matters for compliance professionals as it imposes immediate prohibitions on differential pricing, mandatory annual reviews, enhanced renewal disclosures, and record-keeping, with CBI emphasizing ongoing oversight to ensure fair consumer outcomes.
Suggested considerations
- Pricing Adjustments: Update systems/models to ensure renewal prices ≤ EQFRP; identify close-matched products for comparisons.
- Conduct Reviews: Perform comprehensive annual review of pricing policies/processes, documenting compliance, controls, and rectifications; avoid "tick-box" approaches.
- Enhance Communications: Revise renewal notices/documents to include mandated info (e.g., price, cancellation rights, switching options); handle pre-1 July notices pragmatically but comply in spirit.
- Record Maintenance: Retain written records of reviews, pricing decisions, and compliance evidence for audit readiness.
- Internal Governance: Assess/align with CPC General Principle 2.1; monitor for material changes requiring documented consistency checks.
What changed
- - Ban on Price Walking: Insurance undertakings and intermediaries cannot charge renewing customers (defined as "relevant renewing customers") a premium higher than that charged to an equivalent...
- Annual Pricing Reviews: Firms must conduct an annual review of motor and home insurance pricing policies and processes within two months of each year-end to ensure compliance, including controls to...
- Automatic Renewal Disclosures: Firms must provide specific information to consumers before automatic renewals, including renewal price, right to cancel, and options to switch providers, to promote...
- Record-Keeping: Written records must be retained for annual reviews, material pricing decisions, and compliance assessments.
- Scope Exclusions: Applies prospectively from 1 July 2022; no retrospective application or transitional period.
Compliance impact
Urgency: Medium (as of 2026). The regulations have been effective since 1 July 2022 with no transitional period, requiring immediate system/process overhauls at implementation; non-compliance risks enforcement under Section 48 of the 2013 Act. Ongoing annual reviews and CBI's commitment to monitoring pricing practices sustain medium-term priority, especially amid CBI's consumer protection focus, but established firms likely adapted by now—late compliance or audit gaps remain risks.
References
- [1] centralbank.ie/news/article/central-bank-implements-new-i... third-party
- [2] scribd.com/document/848515323/insurance-regulations-requi... third-party
- [3] centralbank.ie/docs/default-source/regulation/consumer-pr... third-party
- [4] centralbank.ie/docs/default-source/regulation/consumer-pr... third-party
- [5] centralbank.ie/regulation/industry-market-sectors/insuran... third-party
- [6] centralbank.ie/regulation/industry-market-sectors/insuran... third-party
- [7] centralbank.ie/regulation/industry-market-sectors/insuran... third-party
- [8] kroll.com/en/publications/financial-compliance-regulation... third-party
AI-generated analysis. May contain errors or omissions — verify with the original CBI source before acting. Full disclaimer.