Adjustable policies

Insurers frequently do not specify the individual rates charged to calculate an employers’, public or products liability premium, or a declaration linked business interruption cover under a combined policy. This makes it difficult to explain premium adjustments to clients, especially if they experience rapid expansion during the policy period.


For insurers to make known to brokers their rates at policy inception to align with the FCA’s requirement under an Insurance Conduct of Business Sourcebook rule, ICOBS 6.4.6R, that a firm ‘must provide price information in a way calculated to enable the customer to relate it to a regular budget.’

“It would be helpful for insurers to clearly signpost when a policy is written on an adjustable basis and to quote their specific rates which will be used to make any future adjustment. Clients that are in scale-up mode can experience rapid bursts of growth in turnover and staff. Knowing the rates at inception will help us better explain why significant additional premiums might be due at the expiry of a policy and help our clients plan for such expenses.” 


CEO Innovation Broking

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