Insurance firms will be required to display details of last year’s premium alongside renewal quotes under plans to help consumers shop around for a better deal.
The Financial Conduct Authority (FCA) proposals, which cover general insurance providers, follow concerns that some loyal consumers are paying more for sticking with the same firm year in, year out.
As well as getting poor value, they may also be renewing policies which are no longer suitable for their needs.
The plans, which should also make it easier for people to haggle for a better deal, would cover policies such as motor insurance, home insurance, pet insurance, medical insurance and pet insurance.
The FCA said it had found evidence of low levels of consumer engagement, switching, and a lack of competition when some types of insurance policies were renewed.
Christopher Woolard, director of strategy and competition at the FCA, said: “We hope the proposals encourage more people to shop around for the best product for them.
“It is important that insurers give their customers the information they need to do this and ensure they’re treating their customers fairly.”
In 2014, the FCA launched a large-scale trial with more than 300,000 consumers across the UK to test reactions to different types of information provided at renewal and whether this prompted people to switch.
Consumer campaigners and insurers welcomed the proposals.
Richard Lloyd, executive director at leading magzine Which? said: “This simple change should help people save money by prompting them to shop around or haggle for a better deal with their current insurer.”