thoughts & threads

Working in the insurance industry, I have watched the Consumer Duty requirements reshape the way we approach customer value and communication. One year on, it is clear that while the principles of fairness and transparency are sound, the practical impact on home insurance customers is far more complex than the neat headlines suggest.

The article by Sam Barrett in the CII Journal rightly highlights that premium inflation and rising claims costs have overshadowed some of the improvements that insurers have worked hard to implement. We cannot ignore that 2023 was one of the most challenging years in recent memory, with severe storms, supply chain disruption and escalating repair costs all pushing claims expenses to record levels. As someone who deals with underwriting and customer feedback daily, I can confirm that the reality of delivering value while controlling costs has never been more difficult.

One positive shift I have noticed is the sharper focus on communication. Insurers are investing more time in reviewing their customer journeys and explaining products in plain English. This is a direct response to the Consumer Duty requirement to ensure customers fully understand the products they are buying. It has forced us, as an industry, to ask whether we are really listening to customers or simply pushing products. The renewed emphasis on clarity and fairness is a welcome step forward.

However, the problem of affordability remains unresolved. The data cited in the article, with average premiums climbing and some customers facing eye watering increases on contents insurance, is something I see reflected in real customer conversations. No amount of improved communication can soften the shock of a price hike when household budgets are already stretched. While the ABI’s efforts to link premium changes to weather-related claims and rising costs are valid, customers do not always see the connection. From their perspective, it simply feels like another example of insurers prioritising profit over people.

One of the points that resonates most from the article is the finding that nine in ten financial advisers see home insurance as a critical discussion point. This tells me that our industry is still struggling to prove its value. Loyalty is fragile, and while the ban on the so-called loyalty penalty was a step in the right direction, steep premium increases risk undoing that progress. Consumers expect not just fairness but a sense that insurers are genuinely on their side. As a professional in this space, I feel we need to go beyond compliance and actively show customers the value they are getting, whether that is through smarter claims support, better advice or more flexible cover options.

Looking ahead, I believe the real test of Consumer Duty will be whether insurers can balance transparency and fairness with the economic realities that drive pricing. Continuous improvements to communication and product design are important, but they will only mean something if we also find ways to make cover feel accessible and worthwhile. That means investing in technology to streamline claims, finding partnerships that reduce repair costs, and above all, treating customers as long-term partners rather than transactions.

The article is a timely reminder that Consumer Duty is not just a regulatory requirement. It is a call to rebuild trust in an industry that is often seen as reactive rather than proactive. If we get it right, it can push home insurance providers to be more customer-focused, even when external pressures make that a tough task.