FCA pricing regulations

At LV=, we’ve taken steps to make sure your renewal price is always the same or cheaper than you’d get as a new customer with us, for a like-for-like policy.

Our pricing experts have been working hard on updating our process, so before you receive your renewal quote, your price will have already been checked.

Your renewal quote will be compared to new customer price on the same day your renewal was generated and be based on the exact same cover you have today.

Getting a cheaper quote could be due to a variety of things. Usually, it’s because the cover level or the add-ons you’ve selected are slightly different. When we work out your renewal, we use all the same details you gave us when you set up your policy (plus any changes you’ve told us about). If you do get a cheaper new quote with us for the exact same cover you currently have, then please call us and we’ll amend your renewal quote.

From time to time, your renewal price may be cheaper than the price we’d give you as a new customer to reflect our view of changing risk. The regulation states that your renewal price must be the same or cheaper than the equivalent new price.

At renewal we’ll update your details to reflect the changes we know of, such as your car and its drivers being another year older. We’ll then calculate your price using these details*.

*Details include:

1. Amount of cover:
   This includes your excess amount and any additional extras you’ve bought (such as breakdown cover, or legal expenses). When you get a quote on a price comparison website, these details aren’t always included – this is one of the reasons a new quote can appear cheaper than your renewal.
   
2. Timings:
   Insurance prices can change frequently. This means that between your renewal price being calculated (30 days before your renewal date) and your renewal date itself, there may be changes to our prices. This could be due to inflation, the cost of claims, or a change to our view of the risk being insured. If prices go up after you’ve received your renewal quote, we’ll always honour your renewal price - as long as you renew before the expiry date.
   
3. Personal details:
   We’ll calculate your renewal based on the information we already know about you, this includes the names, address, vehicle or home on your policy. If any of your details have changed or if we now ask for additional information for a new quote that we did not ask you when you took out your policy this could result in a different price on price comparison sites.
   
4. How you set up your policy:
   We’ll take into account how you first bought your policy and how you set up your policy. So, depending on whether you bought your policy online or in the call centre, your price may be different.

This change doesn’t mean that your price won’t increase (or decrease) at renewal or that it might be possible to get cheaper like for like cover from elsewhere. It simply means your renewal price is the same or less than a new customer for the exact same cover with us. Want to know more about how your price is calculated? We’ve gone into more detail here:

Car premium explained

Home premium explained

It means you’ll always pay the same or less than you would as a new customer for a like for like policy. Here’s what we mean by ‘like for like’:

• Exactly the same cover you have today including additional extras and your excess amount
• The information we know about you such as your address, names on the policy and the car or home you’re insuring
• The same way you set up your policy (e.g. online or over the phone)
• Compared to a new customer taking out a policy on the same day, because from time to time, our prices may change

For more details, please see below.

The FCA are a financial regulatory body regulating financial firms that provide products to customers to maintain the integrity of markets in the UK. 

Read our handy infographic that helps explain the regulation and what it means for you.