’We know that the FCA is undertaking various pieces of work to make progress on many of the issues our report has highlighted, but the timescales are not clear and it should produce a roadmap of what it is doing,’ says chair
The House of Lords Financial Services Regulation Committee has urged the FCA to ”accelerate” its work to improve consumer understanding of home and travel insurance products, adding that timescales for delivery “are not clear”.
The committee, chaired by Baroness Noakes DBE, launched an inquiry in May 2026 into the regulation of consumer home and travel insurance, with a focus on the FCA’s approach.
In its report, published today (23 October 2026), it said that home and travel insurance products have low claims acceptance rates relative to other retail insurance products.
”They are inherently complex and consumer understanding remains low, despite the FCA’s Consumer Duty requiring firms to support it,” it added.
The report also noted that price comparison websites have driven intense price-led competition in the UK market and while this has helped consumers find affordable products, it has led to a focus on price rather than overall product value.
”The effects of poor consumer understanding often become clear only when a claim is made,” the report continued.
”Products purchased on price rather than levels of cover and a lack of understanding about what is and is not covered, both contribute to persistently high rates of declined claims.”
Improvement needed
Given this, the committe felt that the Consumer Duty regulation, first introduced in 2023, has not yet translated into improvements for consumers.
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Baroness Noakes said: “Comparison websites have made it easier for people to find cheaper insurance, but the lack of good data on other aspects of product value means that many home and travel policies are chosen on price alone.”
The FCA has acknowledged the need for further work on claims-handling practices that carry a higher risk of consumer harm, including outsourced claims handling and cash settlements.
The report also stresses the industry and FCA ”must accelerate their work to improve consumer understanding of home and travel insurance products, particularly what is and is not covered by policies”.
”The FCA must outline how it will address poor claims-handling practices,” it added.
”The FCA is pursuing many of the issues outlined, but the timetables for completion are unclear. The FCA should produce a roadmap with clear timescales for delivery.”
Baroness Noakes added: “The industry and the FCA need to speed up and improve their efforts to help people better understand home and travel insurance, especially what their policies do and do not cover. It is concerning that many of these problems around consumer understanding and comparable data are well known among industry and the FCA, but that significant progress has not yet been made.
“We know that the FCA is undertaking various pieces of work to make progress on many of the issues our report has highlighted, but the timescales are not clear and it should produce a roadmap of what it is doing.”
His career began in 2019, when he joined a local north London newspaper after graduating from the University of Sheffield with a first-class honours degree in journalism.
He took up the position of deputy news editor at Insurance Times in March 2023, before being promoted to his current role in May 2024.View full Profile
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