The Financial Services Authority (FSA) has launched an investigation into the sale of insurance policies as ‘add-ons’ to larger purchases, amid fears consumers could be losing out.
The FSA said it would complete the probe by autumn next year, with resulting market intervention undertaken by successor regulator the Financial Conduct Authority.
The regulator said it was focused the sort of insurance policies sold alongside products such as cars and holidays. It has previously outlined concerns consumers are too focused on the main purchase and may ignore the cost and value of the insurance, and that the terms of policies may mean they are of limited use.
News of the investigation follows the FSA’s requirements on banks to provide to consumers with statements outlining their eligibility for insurance sold as part of a packaged account.